Understanding taxable passive income Homemakers who receive no salary but have income from fixed deposit returns, rental income, dividends, or capital gains are still liable to pay tax if the total annual income exceeds the basic exemption limit. For the financial year 2024-25, the limit is ₹3 lakh in the new tax regime. Even if your income is below the limit, it's worthwhile to file an ITR to avail refunds or maintain a financial record for loans and visa purposes.
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Choosing the right ITR form For all stay-at-home parents earning passive income, ITR-1 (Sahaj) should be enough since it covers income from interest, dividends, pensions, and one house property. In case you have capital gains on the sale of shares, mutual funds, or property, you will be required to employ ITR-2. Filing the correct form will enable you to avoid processing delays or notices from the tax authorities.
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Accurately calculating and reporting income You are mandated to add up all incomes, whether they are from multiple bank accounts or real estate. For example, interest from regular deposits in banks, FDs, and savings are mandated to be added together. Rent received must be declared after expenses of ordinary allowances. Capital gains must be disclosed with the correct holding period category — short-term or long-term — along with applicable exemptions.
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Deductions and exemptions available Homemakers can avail deductions under Section 80C for investments that are eligible such as tax-saving FDs, ELSS, or life insurance premiums up to ₹1.5 lakh. Section 80D provides deductions for premiums paid towards self, spouse, and dependent children health insurance. Payment of interest on home loans is also deductible from taxable income under Section 24(b), if you have one.
Filing process step by step You can e-file ITR online through the Income Tax Department's portal of e-filing. First, register using your PAN and linking it with Aadhaar. Then, download Form 26AS and AIS (Annual Information Statement) to check income data reported by banks or investment websites. Enter income and deduction details in the respective ITR form, authenticate, and upload along with an e-verification through Aadhaar OTP, net banking, or Demat account.
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Why homemakers should file Filing an ITR leaves a financial trail, which can come in handy when availing of loans, credit cards, or visas. It also allows for easy refund processing in the event TDS was deducted on investments. For homemakers who have investment plans or wish to start a small business in the future, a clean tax history will be a long-term advantage.
