Nil Return Filing: Under the new tax regime, the tax liability of those having annual income up to ₹12 lakh will now be zero. The reason for this is the increased tax rebate of ₹60,000.
Nil Return Filing: The process of filing Income Tax Return (ITR) for the financial year 2024-25 has started. In such a situation, many salaried people are wondering whether they need to file ITR if their income is less than ₹ 12 lakh?
What is the new tax slab?
The new income tax rates for the financial year 2025-26 (assessment year 2026-27) are as follows:
| Annual Income | Tax rate |
| Up to ₹4,00,000 | No Tax |
| ₹4,00,001 – ₹8,00,000 | 5% |
| ₹8,00,001 – ₹12,00,000 | 10% |
| ₹12,00,001 – ₹16,00,000 | 15% |
| ₹16,00,001 – ₹20,00,000 | 20% |
| ₹20,00,001 – ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
Under the new tax regime, the tax liability of those having annual income up to ₹12 lakh will now be zero. The reason for this is the increased tax rebate of ₹60,000.
When is it necessary to file ITR even if you do not have to pay tax? Know under which circumstances ‘nil return’ is mandatory
The Income Tax Return (ITR) filing season has begun and millions of taxpayers are wondering if they need to file ITR if their income is not taxable or does not attract tax. The answer is yes in most cases.
Tax expert Balwant Jain explains that ” not having any tax liability and not filing ITR are not the same thing. ” That is, even if your tax liability is zero, you may still be required to file ITR in many circumstances.
If your income exceeds the basic exemption limit, it is mandatory to file ITR
If your total gross income, i.e. income before deductions and exemptions, exceeds the basic exemption limit set by the government, it is mandatory for you to file ITR—even if your tax liability later becomes zero.
Basic exemption limit under Old vs New Regime:
New tax regime (all ages) : ₹3 lakh
Old Tax Regime :
- < 60 years: ₹2.5 lakh
- 60-80 years: ₹3 lakh
- Above 80 years: ₹5 lakh
Example:
If your income is ₹4 lakh and you have availed exemption of ₹1.5 lakh, then tax becomes zero but since the gross income was more than ₹2.5 lakh (in old regime), filing of ITR becomes mandatory.
In these cases, it is necessary to file ITR, irrespective of the amount of income
Tax expert Sushil Jain explains that in certain situations, even if your income is less than the tax limit, it becomes legally mandatory to file ITR:
Deposit of ₹1 crore or more in bank account
If you have deposited a total of ₹1 crore or more in one or more current accounts, you are required to file ITR.
Spending more than ₹2 lakh on foreign travel
If you have made an international travel booking of more than ₹ 2 lakh for yourself or someone else, then it becomes necessary to file ITR.
Electricity bill more than ₹1 lakh
If your annual electricity bill is above ₹1 lakh, it is mandatory to file ITR even if your income is below the tax exemption limit.
Foreign assets or foreign income
If you have any property abroad or have any income from there, ITR filing is mandatory, irrespective of your other income.
TDS has been deducted
If your income is not taxable, but the bank or any institution has deducted TDS on interest or payment, then it is necessary to file ITR to claim that refund also.
4 big benefits of filing ‘Nil return’
According to Mohit Gang, CEO and MD of Moneyfront, “Even if you don’t have to pay any tax, filing a nil return can give you huge financial benefits in the future.”
1. Claiming TDS refund
To get refund of TDS (Tax Deducted at Source) deducted on savings account in banks, FD or dividend etc., you will have to file ITR.
Example: If your FD earned you ₹10,000 in interest and the bank deducted TDS of ₹1,000 on it, but your total income is not taxable, you can get this money back by filing ITR.
2. Documents required for loan, visa, credit card
ITR is a kind of your financial profile. It is considered a reliable document when applying for a bank, non-bank loan company, or visa for foreign travel—if it is ‘nil’.
Example: If you are starting a job and your income is ₹2.4 lakh but want to take a personal loan, showing ITR strengthens your application.
3. To carry forward losses in the stock market
If you have incurred losses (capital losses) in stocks or mutual funds in a given year, you can carry forward it for the next 8 years—but only if you have filed ITR for that year.
Example: If you show a loss of ₹50,000 and file ITR in the same year, then next year if you make a profit, this loss can be set off against it.
4. Strengthen your tax records
Filing ITR every year strengthens your record with the tax department. If there is any scrutiny or notice in the future, your track record can protect you.
Example: If you have traded in shares or have made huge transactions in your bank account, the system can track you. If you have filed Nil ITR, you are already considered compliant.
Salaried taxpayers will get additional benefit
If you are a salaried person, then due to standard deduction of ₹ 75,000, you will not have to pay any tax on income up to ₹ 12.75 lakh. This will provide great relief to the middle class.
Some important things:
- Marginal relief on rebate will still apply.
- This exemption is applicable only on normal income and not on special tax rates (like capital gains under section 112A).
What is Nil Return?
If your annual income is less than the tax exemption limit, you can file a nil return to show the Income Tax Department that your tax liability was zero. It is not mandatory to fill it, but it can be beneficial in the future, such as at the time of loan or visa application.
Why is it necessary for even low-income earners to file ITR? Know when to file ‘nil return’
If your total income is less than the taxable limit and you think that there is no need to file Income Tax Return (ITR), then think again. There are many occasions when filing a ‘nil return’ i.e. ITR without tax also proves beneficial.
When to file Nil Return?
- To show income proof: If you are starting a job or your income is below the tax limit, it can still be beneficial to file ITR. Many times ITR is asked as income proof while getting a visa or passport.
- To maintain old records: If you have been filing ITR for several years in the past and this year your income is below the tax bracket, it is still wise to continue filing ITR. This will save you from any queries from the tax department.
- To claim refund: It is possible that your income does not fall under the tax bracket, but TDS has been deducted. In such a situation, it is necessary to file ITR to get refund.
Some important things:
- The new tax system is now the default, but you can also choose the old tax system, which offers exemptions and deductions.
- Capital gains, foreign earnings or business income are taxed separately, even if the total income is less than ₹12 lakh.
ITR filing last dates:
- Non-audited cases: July 31, 2025
- Audit Case: October 31, 2025
- Those reporting under section 92E: November 30, 2025
