prpri Penalty for Late Filing of Income Tax Return / Belated Return Filing of Belated Return under Income Tax Act

Have you missed the extended income tax return (ITR) filing deadline for FY 2017-18 which was 31st August, 2018?

Don’t worry, you can still have time to file your return. But for filing ITR after due date few things which you must be aware. In view of that, give a thorough read to this article.

Last Date to file Belated Income Tax Return

If an individual is filing the ITR after due date, then as per the provisions of the income tax Act, he can file a belated return.

Deadline to file the belated ITR is 31st March, 2019 for FY 2017-18.

Late Fee for Filing Belated Income Tax Return

From the FY 2017-18, Government through budget 2017 has changed the penalty structure for filing belated return as follows.

PARTICULARS Late Fee U/s. 234F
Belated ITR filed till 31st Dec, 2018 5000
Belated ITR filed till 31st March, 2019 10,000

However, for granting some relaxation to taxpayers having Income upto 5 lakh (small taxpayers) fee levied for filing Belated ITR will be of Rs. 1000.

Who will not have to pay Fee for delayed filing of Income Tax return

Individuals whose gross total income does not exceed the basic exemption limit files a belated return, he/she will not be liable to pay penalty. Also, such individuals will be able to claim deductions as available under section 80C to 80U of the Act.

Currently basic exemption limit of resident individuals are:

RESIDENT INDIVIDUALS BASIC EXEMPTION LIMIT
Age below 60 years Upto 2.5 lahs
Age 60 years and above but below 80 years Upto 3 lakhs
Age 80 years and above Upto 5 lakhs

Who have to pay the Fee for delayed filing of Income Tax return

Individuals who are mandatorily required to file the ITR have to pay the penalty for delayed filing. Section 139(1) of the Act states that the following persons have to mandatorily file ITR:

 (a) a company or a firm/LLP irrespective of quantum of income and

(b) any other person if his total income exceeds basic exemption limit.

Circumstance where Individual’s income is below the exemption limit but still have to mandatorily file ITR:

A resident individual earning income from foreign assets even though his income is below the minimum exemption limit will have to mandatorily file ITR.

For ex- In FY 2017-18 an individual (age 35 years) earned a total income of Rs 1.5 lakh from dividend of shares held in a foreign company. In that case, even though his Income is below the minimum exemption level of Rs 2.5 lakh, he will still have to mandatorily file the ITR.

In such a case, penalty will be levied on filing ITR after due date.

 Demerit of Filing Belated Return

  • Although the individual will not be penalized for late filing your ITR because of the income falls under the exemption slabs but it is in your best interest to file ITR before due date since if the ITR is filed before the due date, then interest payable on tax refund will be calculated from 1st April of the relevant assessment year to the date on which refund is granted.  In case a belated ITR is filed after due date interest will be calculated from the date of filing of ITR to the date on which refund is granted. In such a case Individual  would lose out on some of such interest.
  • Also, you will not be able to carry forward losses in case of filing a belated return.
  • Belated ITR filed cannot be revised

(The article has been written by CS Nikita Gupta, backed by skills in Corporate and Regulatory laws. For detailed analysis on any of the provision or for any query, writer can be contacted through mail ID- n.nikitagupta.g@gmail.com)

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2 Comments

  1. SIJU VARGHESE says:

    Very Informative article…

    Please note, belated Return can be revised within one year from the end of the relevant A.Y. w.e.f.01.04.2017.

    Thanks

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