When your income exceeds a specific limit, you have to pay tax on it and for this you have to file Income Tax Return (ITR). According to the Income Tax Department, a total of 3.06 crore ITRs have been filed till July 18. Filing ITR is important for every individual including housewives who do not have any regular source of earning. In some cases, housewives may receive revenue from various sources such as interest on FDs or rental income, even if they do not have a job or business and no primary source of earning.
But in most of the cases, the housewives do not have any personal source of income and hence, they do not file ITR. But experts suggest that they should still file income tax returns.
A housewife whose income is less than Rs 3 lakh will not be taxed under the revised tax system. As per the new tax regime, the minimum deduction has been raised to Rs 5 lakh if a homemaker is considered a super senior individual who is 80 years or more.
Let us have a look at the scenarios in which a housewife should file ITR:
For financial stability or to reduce the financial burden of the household, the parents or husband may have made investments in the name of the homemaker. These investments in bank accounts, mutual funds, equity etc. can accumulate over time and generate huge income. And if the returns on these investments are taxable in the name of the housewife, then ITR must be filed.
Interest from fixed deposit or gift received
Vishwajeet Songara, Founder, Quiko, says, “FD interest is taxable as per the slab rate. Hence, it is necessary to file ITR if the interest income exceeds Rs 2.5 lakh. If the housewife has invested the amount in any instrument other than FD and the earning from the same exceeds the exemption limit, then she has to file ITR. Gifts received from specified relatives on certain occasions are not included in taxable income irrespective of the quantum of gift amount.”
Benefits of filing ITR without any tax liability
Whether you are a stay at home mother or housewife with no reliable source of income or zero income, filing income tax return makes it easy for you to avail loan. You must have filed ITR continuously for at least three years to be eligible for the loan. Many banks offer interest rate reduction for home loans taken in the name of women. Your ITR acts as proof of your income which the bank can use to determine your eligibility.
This has not only made it easier to get loans, but also to get TDS refunds. Another advantage of providing ITR proof when requested by the authorities is eligibility to apply for visa and ITR documents play a vital role in getting visa. In these circumstances, a nil ITR needs to be filed.