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CMA Intermediate · Direct and Indirect Taxation · Filing of Return of Income

Under section 263 of the Income-tax Act, 2025, which of the following persons must furnish a return of income for the tax year even if the income is below the maximum amount not chargeable to tax and there is no loss?

A firm must file a return for the tax year regardless of income or loss, because section 263(1)(b) lists firms among the persons who file irrespective of income. Individuals or HUFs below the exemption limit with no other trigger are not obliged to file.

  1. AA resident individual whose total income is below the basic exemption limit and who has no foreign assets
  2. BA firmCorrect
  3. CA Hindu undivided family with income below the exemption limit
  4. DA person other than a company or firm who has sustained a loss under the head salaries

Explanation

Section 263(1)(b) requires companies, firms, universities or colleges, business trusts, investment funds and certain resident persons with foreign assets to file regardless of income or loss. A firm is therefore covered. An individual or HUF below the exemption limit is not obliged, and a loss under salaries is not a loss that is to be carried forward.

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