What is Nil ITR? Know who can file this return and what are the benefits – what is nil itr who can file this income tax return and what are the benefits
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If your gross total income is less than the basic exemption limit in the financial year 2022-23 (Assessment Year 2022-23), then it is not mandatory for you to fill ITR. The basic exemption limit depends on which income tax regime you have chosen. If someone has opted for old tax regime in FY 2022-23, then the basic exemption limit will also depend on the age of the person. If one has opted for the new tax regime, then the basic exemption limit is Rs 3 lakh. Although it is not necessary to file ITR if your income is less than the basic exemption limit, but still if you file ITR, it will be a good decision.
What is Nil ITR?
Nil ITR is the ITR in which there is no tax liability on the taxpayer. Means no tax is being made on you, yet you are filling ITR, then it will be Nil ITR. No tax will be levied even if the taxpayer’s net total income after claiming deductions and exemptions remains less than the basic threshold limit. In such a situation the filled ITR will also be called Nil ITR. Dr. Suresh Surana, Founder, RSM India, said, “There may be cases where the net tax liability becomes nil after availing exemption under section 87A. In such cases also the return filed will be termed as Nil ITR.
Why should I fill NIL ITR?
Neeraj Agarwal, partner, Nangia Andersen India, says, “It is prudent to file an income tax return even if you are not liable to pay any tax. This brings your income on record for that financial year. It will give you peace of mind. Apart from this, even if you take a home loan, you can show this ITR.
Benefits of filing zero ITR
There are many benefits of filing Nil ITR. Let’s know about them.
easy to take loan
Surana said, “Income tax return acts as a certified document of income proof from the Government of India. Apart from this, submitting ITR to the lending banks and institutions can make the loan approval process easier.
It will be easy to get scholarship
Surana said, “In some scholarship cases, students applying for the same may be required to submit their income tax return proof.” For example, there are some special government scholarships, according to which the income of the entire family should be below a certain limit.
Visa
“For foreign travel, visa authorities generally require ITRs of the last few years,” Surana said. This is because, the foreign country to which one wishes to travel would need to verify their income level before granting a visa. Therefore, it is necessary to submit ITR, bank statement and other financial documents at the time of visa application.
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