Filing tax return and paying the tax due to be paid by you are two different obligations that need to be discharged rightly. This said, there remains confusion among salaried class that if TDS is deducted from their salary by the employer they are not liable to pay the tax and some of them consider it as merely an act wherein their employers file ITR for them.
So, for your understanding, here we detail who actually needs to file income tax return. It is to be noted that the discussion covers provisions that apply to individual taxpayer category.
ITR in a general case is to be filed if gross total income exceeds basic exemption limit
An individual is required to file income tax return if his aggregate income before deduction allowed under various sections such as 80C, 80CCC, 80CCD, 80D, 80E80G, 80 GGA, 80 TTA is more than the basic exemption limit of Rs. 2.5 lakh for the financial year 2017-18. For a resident individual who is aged more than 60 years referred as senior citizen, the exemption limit is Rs. 3 lakh whereas in case of super senior citizens who are aged over 80 years, it is Rs. 5 lakh.
The different sections stated above under chapter VI A of the Income tax Act provide deduction in lieu of some of the expenses and investments like repayment of home loan principal, school fees, life insurance premium, medical insurance premium, donations made, interest on education loan, rent paid by self-employed, investments in PPF, NPS, ELSS, NSC etc.
There is another section 80 TTA that provides deduction for interest earned on savings bank account.
Now section 139 (1) 6th Proviso states that all assessees other than company and firm that can be Individual or HUF are required to file Return of Income if total income before giving effect to Chapter VI A (deductions) and Section 10(38) Exemption exceeds the maximum amount not chargeable to tax
ITR is to be filed by a resident taxpayer who owns any asset or is an authorized signatory outside India
The liability to file the income tax return also becomes due if you are an Indian resident as per the Income tax rules and own any asset in your name outside India or have interest in some asset outside India or even in a case when you have the signing authority in respect of some account outside India. It is to be noted that the provision applies to both immovable and movable asset that you may own outside India.
Say for instance, if you have invested in securities such as shares, mutual funds, bonds etc. of foreign companies then you are liable to file the tax return irrespective of the income realized by you for the given financial year. Also, in a case when you had gone on deputation or for some job to a foreign land and had opened a bank account there and forgot to get it closed then also you are liable to file the return even if there is no money in the account.
Even when you are in receipt of Employee stock options or ESOPs from a foreign company that is the holding company of your employer in India, you are required to file the ITR.