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  5. 9 conditions in which ITR filing is mandatory for AY 2026-27

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9 conditions in which ITR filing is mandatory for AY 2026-27

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By Sangeeta Ojha

5 min read | Updated on June 19, 2026, 16:04 IST

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SUMMARY

While most taxpayers know that ITR filing is mandatory when income exceeds the exemption limit, many are unaware that the Income Tax Act also mandates return filing in several other situations.

9 conditions in which ITR filing is mandatory

For the financial year 2025-26 (assessment year 2026-27), the basic exemption limit under the new tax regime is ₹4 lakh. | Image: Shutterstock.

It is that time of the year when everyone is talking about Income Tax Return (ITR) filing. The most common questions are: Have you received your Form 16? When should I file my ITR? Should I do it myself or ask a CA? After all, the word "tax" has the potential to boggle the mind.
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While most taxpayers know that ITR filing is mandatory when income exceeds the exemption limit, many are unaware that the Income Tax Act also mandates return filing in several other situations.

Individuals and Hindu Undivided Families (HUFs) are required to file an income tax return if their income, before claiming specified exemptions or deductions, exceeds the maximum exemption limit. Filing is mandatory in certain cases even if income is below the exemption limit, such as ownership of foreign assets or undertaking high-value transactions.

In this article, we will discuss nine conditions in which ITR filing is mandatory.

Mandatory filing scenarios

1. Income exceeds the exemption limit

If the total income of an individual or HUF, before claiming the following deductions or exemptions, exceeds the basic exemption limit:

Deduction under Sections 10A, 10B, and 10BA

Exemption under Sections 54, 54B, 54D, 54EC, 54F, 54G, 54GA, or 54GB

Deductions under Sections 80C to 80U

SectionDeduction / Exemption Allowed
Section 10ADeduction for profits earned by certain export-oriented units in SEZs and software technology parks (mostly older cases).
Section 10BDeduction for profits of 100% Export Oriented Units (EOUs).
Section 10BADeduction for export profits from handmade articles and handicrafts.
Section 54Exemption on capital gains from sale of a residential house if another residential house is purchased/constructed.
Section 54BExemption on capital gains from sale of agricultural land if another agricultural land is purchased.
Section 54DExemption on compulsory acquisition of land/building used for industrial purposes.
Section 54ECExemption if long-term capital gains are invested in specified bonds.
Section 54FExemption on capital gains from sale of assets other than a residential house if invested in a residential house.
Section 54GExemption on shifting an industrial undertaking from an urban area to a non-urban area.
Section 54GAExemption on shifting an industrial undertaking from an urban area to a Special Economic Zone (SEZ).
Section 54GBExemption on capital gains invested in eligible startups or companies.
Section 80CDeduction for investments like PPF, EPF, ELSS, life insurance premiums, home loan principal repayment.
Section 80CCD(1B)Additional deduction for contributions to the National Pension System (NPS).
Section 80DDeduction for medical insurance premiums.
Section 80DDDeduction for maintenance of a dependent with disability.
Section 80EDeduction for interest paid on education loans.
Section 80GDeduction for donations to eligible charitable institutions.
Section 80TTA/80TTBDeduction for savings account interest / interest income for senior citizens.
Section 80UDeduction for a taxpayer with a disability.
Why are these sections relevant for ITR filing?

Suppose your gross income is ₹5 lakh under the old regime and you claim a deduction of ₹1.5 lakh under Section 80C. Your taxable income becomes ₹3.5 lakh. Even though tax may not be payable after deductions, you may still be required to file an ITR because your income before claiming deductions exceeded the applicable exemption limit.

2. Foreign assets

Any resident individual who owns, is a beneficiary of, or has a financial interest in any asset located abroad, or has signing authority in any overseas bank account.

High-value transactions
3. Current account deposits

Deposits exceeding ₹1 crore in one or more current accounts during the financial year.

4. Foreign travel expenditure

Expenditure exceeding ₹2 lakh on foreign travel during the financial year.

5. Electricity consumption

Electricity bills exceeding ₹1 lakh during the financial year.

6. Business turnover

Business turnover exceeding ₹60 lakh during the financial year.

7. Professional receipts

Gross receipts from a profession exceeding ₹10 lakh during the financial year.

8. TDS/TCS threshold

Tax deducted or collected at source (TDS/TCS) aggregating ₹25,000 or more during the year. For senior citizens, the threshold is ₹50,000.

9. Savings bank deposits

Deposits exceeding ₹50 lakh in one or more savings bank accounts during the financial year.

For the financial year 2025-26 (assessment year 2026-27), the basic exemption limit under the new tax regime is ₹4 lakh. However, owing to the rebate available under Section 87A, individuals with a taxable income of up to ₹12 lakh generally do not have to pay any income tax, subject to prescribed conditions. Under the old tax regime, the basic exemption limit is ₹2.5 lakh for individuals below 60 years of age, ₹3 lakh for senior citizens aged between 60 and 79 years, and ₹5 lakh for super senior citizens aged 80 years and above.
Have an ITR filing query for AY 2026-27? We will try to get them answered by experts. Write to sangeeta.ojha@rksv.in
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Disclaimer: The information contained in this article is for informational purposes only and does not represent investment advice from Upstox. Investment decisions should be made based on independent research or consultation with a registered financial advisor. Past performance is not indicative of future results.

About The Author

sangeeta-ojha.webp
Sangeeta Ojha is a business and finance journalist with experience across leading media platforms like Mint and India Today. She has built a reputation for covering a wide range of personal finance topics, including income tax, mutual funds, insurance, savings and investing.

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