ITR filing for zero income or a nil return

A nil return is a return that shows no taxable income, or income so low that no tax is payable. If your income is below the filing limit and no special condition applies, you do not have to file one. You may still want to, to claim a refund of TDS, to keep an income record, or because your AIS shows income you did not expect.

The limits below are the signed-off figures for the tax year 2025-26. For the tax year 2026-27 they are provisional and have not been signed off against the Income-tax Act, 2025.

"Zero income" is rarely zero

Before you decide, check what the department already shows against your PAN. Many people with "zero income" in their mind have:

• Savings bank interest and fixed deposit interest.
• Dividends from shares or mutual funds.
• Small capital gains from a mutual fund redemption.
• Interest on an income tax refund from an earlier year.

These appear in your AIS and TIS. If a return shows nil but your AIS shows ₹40,000 of interest, a mismatch can trigger a notice. Compare first, then decide.

When a nil return is required

You must file even with low or nil taxable income when:

• Your gross total income is above the basic exemption limit: ₹2,50,000 (below 60), ₹3,00,000 (60 to 79), ₹5,00,000 (80 and above), old regime figures.
• TDS and TCS together are ₹25,000 or more (₹50,000 or more for senior citizens).
• A specified trigger applies, for example business turnover or receipts above a limit, large deposits or foreign travel. The limits are set by the department; read them in the instructions for the ITR form before deciding that you need not file.

Notice that "nil tax" and "nil income" are not the same. A person with ₹9,00,000 of salary pays nil tax in the new regime because of the rebate, but that return is a full return, not a nil one, and it is compulsory.

When a nil return is worth filing

• TDS was deducted on your income. A bank may have deducted tax on interest although your total income is below the limit. The refund comes only through a return.
• You need proof of income for a loan, visa or credit card.
• You want to carry forward a loss. This needs a return filed by the due date.
• You are a student, homemaker or retired person who wants clean records and a refund of any TDS.

Which form to use

The form follows the kinds of income, not the amount. With salary, pension, interest or one house, it is usually ITR-1. With capital gains beyond the ITR-1 limit, more than one house or foreign assets, it is ITR-2. See which ITR form to file.

Step by step

1. Download your AIS and Form 26AS (Form 168 from the tax year 2026-27) and list every income.
2. Add up your income and compare it with your limit.
3. Add up the TDS shown. If your tax is lower, the difference is your refund.
4. Choose the form, enter the income and the TDS, and give a bank account for the refund.
5. Submit and e-verify within 30 days. A return that is not verified is treated as not filed, and no refund comes.

Late filing and a nil return

On TaxCare's rules, the late fee under section 234F is charged only on a person who was required to file. If you were never required to, a late nil return costs no fee. If you were required, the fee is ₹5,000, or ₹1,000 when total income is ₹5,00,000 or less.

A short example

Meera is a student who earned ₹1,20,000 from a part-time job in the tax year. Her employer deducted ₹6,000 of TDS. Her income is below ₹2,50,000, so she is not required to file. Her tax on that income is nil, so the ₹6,000 deducted is hers to get back. She files ITR-1, enters the salary and the TDS, and claims a refund of ₹6,000. Without the return, the money stays with the department.

The example is illustrative: the TDS must appear in her Form 26AS (Form 168 from the tax year 2026-27) for the refund to be claimed.

How TaxCare helps

TaxCare fetches your AIS, TIS and Form 26AS or Form 168 after an OTP, so you can see all reported income before deciding. It works out whether you are required to file, calculates the tax and the refund, and chooses the form. You can also prepare returns for parents or other family members from the same account. See pricing.

This guide gives general information and is not professional tax advice.