New Rules 12AB - Additional Conditions for Mandatory Income Tax Return Filing

New Rules 12AB - Additional Conditions for Mandatory Income Tax Return Filing

Rule 12AB - New Additional Conditions for IT Return Filing

The government has increased the scope of filing returns of income. It inserted four additional conditions by issuing Notification No. 37/2022 dated 21st April 2022 thereby notifying the Rule 12AB through Income-tax (Ninth Amendment) Rules, 2022. Therefore, now the assessee (other than companies and firms) will have to file their income tax returns even if their total income does not exceed the threshold limit of Rs. 2.50 lakhs in the following additional cases:

  1. If his total sales, turnover, or gross receipts, as the case may be, in the business exceeds Rs. 60 lakhs during the previous year; or
  2. if his total gross receipts in profession exceed Rs. 10 lakhs during the previous year; or
  3.  if the aggregate of tax deducted at source and tax collected at source during the previous year, in the case of the person, is Rs. 25,000 or more; or
  4. the deposit in one or more savings bank accounts of the person, in aggregate, is Rs. 50 lakhs or more during the previous year

However, in the case of a person resident in India aged 60 years or above, the limit shall be Rs. 50,000 instead of Rs. 25,000 for clause (iii) above.
Earlier, the 7th proviso to Section 139(1) prescribed only three conditions whereby, even though the assessees’ (other than company and firms) total income or income in respect of which they are assessable did not exceed Rs. 2.50 lakhs, still had to file their income tax returns. Apart from the above newly inserted conditions, the other existing conditions include the following:

  • Deposit of Rs. 1 crore or more in one or more current accounts with banks.
  • Incurring expenditure of Rs. 2 lakhs or more for foreign travel of self or any other person.
  • Incurring expenditure of Rs. 1 lakh or more for consumption of electricity.

In case of any queries about rule 12ab, please feel free to contact the ASC Group.


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