There is a misconception among most salaried individuals that because the employer has deducted tax at source, they are not required to file tax returns. Even though tax has been deducted and there is no other source of income, or liability to pay tax, employees have to file income tax returns.
Every individual has to necessarily file the income-tax returns if the total income, before allowing any deduction, exceeds the exemption limit.
Job does not end at paying taxes, filing returns is equally important.
When does it become essential to file returns?
It is essential to file returns when your income crosses/exceeds the basic exemption limit even if it means that on account of you investment planning, your tax obligation may be nil. So for FY 2011-2012 ( A Y 2012-2013), filing of tax returns is essential if
• Individuals have taxable income exceeding Rs.180,000 p.a.
• Women have taxable income exceeding Rs.190,000 p.a.
• Senior Citizens have taxable income exceeding Rs.250,000 p.a.
Even if your income is below the exemption limit, which is bound to happen at the beginning of one's career, filing income tax returns will help in the documentation process if you are taking a loan or an insurance policy or when you are applying for a visa.
