Due date for Filing Income Tax Return for Assessment Year 2018-19 for  Salaried Persons and other Assessees who are engaged in business and profession and whose turnover is less than  Rs. 100 lakh (in the case of business) and Rs 25 lakh (in the case of profession wef from A.Y 2017-18 it is Rs 50 Lakhs) is 31st July 2018.  In this article we have detailed in the form of Question answers Consequences of Delay in Filing Return of Income or of Filing Return after the due date.

Please Note- Tax Audit Limit for Professionals been revised to Rs. 50 Lakh from Assessment Year 2017-18 with a Higher Presumptive Rate of Taxation for those who are having Turnover Below Rs. 50 Lakh. Further there is also changes in Provisions related to belated Return from Assessment Year 2017-18.

Q1.-First, what are the due dates for Income Tax Return Filing?

Answer:- Assessees having income from salary have to file return of income before July 31 of the assessment year. This is the `due date’ prescribed in section 139(1) of the Income Tax Act, 1961.

Self-employed businessmen and professionals, and those deriving income from let-out property too have to file their returns by this date.

However, businessmen and professionals with aggregate turnover/annual receipt exceeding Rs 100 lakh (in the case of business) and Rs 50 lakh in the case of profession have time up to September 30th for filing their return of income.

Q2. What are the benefits of filing Income Tax Return by the due date?

Anwer:- An assessee filing return by the `due date’ provided in the statute is eligible to file a revised return if he discovers any omission or wrong statement therein. No penalty would be levied for filing a revised return on voluntary basis. However there are some changes in provision related to time limit for filing of revised income tax return wef from A.Y 2017-18 and 2018-19.

Wef A.Y 2017-18- Belated return filed u/s 139 (4) can also be revised, within one year from the end of the assessment year or before completion of assessment whichever is earlier.

Wef A.Y 2018-19-Return filed us section 139(1) and 139(4) can be revised before the end of the relevant assessment year or before completion of assessment, whichever is earlier.

Q3. So, by filing Income Tax Return after due dates, does one lose the revision option?

Answer:- Yes. If an assessee does not file his return within the `due date’ and files his return subsequently, he cannot have the benefit of revising the return, as the return filed beyond the `due date’ is treated as `belated return’. However wef from A.y 2017-18 belated return u/s 139(4) can also be revised.

Q4. Any other advantages of sticking to the due dates of Income Tax Return filing?

Answer:-The taxpayer gets the advantage of carry forward and set off of losses, such as loss from business and loss under the head `capital gains’. If the return is filed beyond the `due date’ mentioned in section 139(1), these losses cannot be carried and set off against the income of subsequent years.

You cannot carry forward following losses in case of delayed filing:

  • Speculation loss,
  • business loss excluding loss due to unabsorbed depreciation and capital exp on scientific research,
  • short term capital loss,
  • long term capital loss,
  • loss due to owning and maintenance of horse races
  • Loss from specified business u/s 35Ad wef A.Y. 2016-17

Yet another advantage of filing return before `due date’ is the eligibility for interest on tax refund from April 1 of the assessment year.

Q5. Can delay in filing of Income Tax Return, therefore, be wasteful for `refund’ cases?

Answer:-Yes, because where the return is filed after the `due date’, interest on refund is paid only for the period from the month of filing the return to the date of refund. In other words, no interest is paid for the period from April 1 of the assessment year to the date of filing the `belated return’.

Q6. Do those with `nil’ tax liability have anything to fear if they file Income Tax Return after due date?

Answer:-Where the return is filed beyond the `due date’, the taxpayer has to pay interest if any, on tax liability existing beyond tax deducted at source (TDS) or tax collected at source (TCS) or the advance tax paid. The question of interest does not arise where tax due for payment is `nil’, as would be in the case of most salaried people who pay their taxes through the TDS route. Legally, a taxpayer can file his return before the end of the assessment year without any penalty (however with penal interest under section 234A). Again, the question of penal interest does not arise in the `nil’ cases discussed above. For the assessment year 2018-19, return of income could be filed up to March 31, 2019.

Q7. How costly can delay in filing Income Tax  return can be?

Answer:-Apart from interest and penal interest, there are other implications. If the return is filed after March 31, 2017 but before March 31, 2018 the AO (Assessing Officer) could levy a penalty of Rs 5,000 under section 271F. Even when there is no further tax payable on the income admitted, penalty under section 271F is leviable for the delay. If the return is filed after March 31, 2018 then such return would become an invalid return.

However wef from A.y 2018-19 Penalty u/s 271F shall be replaced by late filing fees U/s 234F. The assessee shall be liable for late filing fees under section 234F from A.Y 2018-19 onwards. The late filing fees is explained in table below:

Serial No. Date of Filing Return Amount of late filing fees u/s 234F (Rs)
1. If the return is filed after the due date but on or before 31st December of the assessment year 5,000
2. If the return is filed after 31st December of the assessment year 10,000

However if the total total income does not exceeds Rs 5 lakhs the amount of late filing fees shall not exceed Rs 1,000.

Q8. Can Assessee be imprisoned for Non-Filing of Income Tax return?

Not filing of Income tax returns on time can land you in jail. This can happen if the I-T authorities feel the assessee wilfully failed to furnish returns on time and the tax due is more than Rs 3,000. Under section 276CC of the I-T Act, if the amount of tax exceeds Rs 25 lakh, the assessee can be sentenced to rigorous imprisonment for anywhere between six months to seven years, and fined. In other cases, imprisonment can be between three months and two years, with fine.However, these penalties are levied in a very rare case. In most of the cases, the taxpayer is only required to pay interest @ 1% for late deposit of income tax.

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78 responses to “How costly can the delay in filing tax returns be?”

  1. Ram Sakal Mahto says:

    Sir,

    We have file itr for AY 2017-18 on 30/07/2017, but we have missed the Ay 2016-17, we have not file the return for ay 2016-17, There is not taxable income, in the ay 201-17, suggest me what we should do ? We have to file the return for ay 2018-17 by tomorrow .

  2. Khan says:

    Sir,
    I have not filled ITR since 2013-14. I am a salaried person and my Company deduct TDS on time. There is no other income source for me. I also have Form-16 for all the years. Can I file the ITRs now for all the pending years.

  3. Sajid Shaikh says:

    Sir, I have not filed my income tax return for AY 12-13 and refund comes to Rs. 12 Lack what should we do, TDs reflects in 26AS.

  4. MP says:

    sir
    from ass Yr 16-17 the banks will be deducting TDS even for their members in-spite of giving form15H/G but will that not reduce the interest eligible on a cummulative deposits if kept for the entire period of 3 years because the bank cummulates interest after every 3 months and accordingly the final interest is mentioned on the receipt of the FDR, but as the banks will be deducting TDS every quarter if the total interest

    exceed 10000 the investor will loose the benefit of compounding

  5. raj says:

    Sir i have started my company at 2014 and my losses is about 6-8 lacs while registered capital was only 1 Lac(it is because i don’t had ,much idea about RTI.) because i was belong to a middle class and that amount is matter for me and my financial situation so in Dec 2014 i paused my company to avoid from these losses. now i want to start it again and want to update all thing related to documents, untill i did not submit return of 2015-16 and 2016-17, what fee should i have to pay or what step should i take

  6. MCS says:

    I want to file a return of a company for the AY 11-12. Can i file? If yes then what are the compliances i have to done? What are the penalties that will be levied

  7. ankit jain says:

    Sir,

    My quterly sales tax return file will be delay by 3 days for f.y-15-16, so what would be the penalty charge on me.

    thanks

  8. Ashish Pande says:

    Dear Sir
    I gave my complete necessary details to CA for AY 2014-2015 but now i am finding online on income tax site its not showing filing or any initiation done.When i enquired this to CA he said he has filed & has asked I-Tax Deprt for feedback.

    My question is it possible
    Regards
    Ashish pande

  9. Sushil pradhan says:

    I am received bank internet and dedicated the tds at Rs.1200/- from A bank so my return was late therefore the return for A.Y.2014-2015 could not filed,sir can i filed return of A.Y.2015-2016 and gI am received the tds at Rs.48000/- from A COMPANY so my return was late therefore the return for A.Y.2012-13 could not filed,sir can i filed return of A.Y.2012-13 and can i get my refund. –

  10. CA Richa says:

    Weather an assessee can file his/her NIL return for F/Y 2012-13 in the F/Y 2014-15. And also weather it would attract any kind of Penalty or not ?????

  11. VIVEKANAND says:

    Sir,

    My father has not filled ITR for the FY year 2013-14 (Assessment yr 2014-15) and his tax payable is Rs 1, ( he is a govt employee). Kindly advise what to do.

  12. CA Deepak Aggarwal says:

    Can the TDS return for FY 2009-10 & 2011-11 be revised now?

  13. s sudarshana says:

    Mr.Raghav, You can file the return for the earlier years after or before the notice is received. File it now and dont forget to add about 2% per month as penalty for the tax due but not paid from the end of the relevant finanial year. Take care to see you pay the tax online or otherwise for the correspoing A.Y.

  14. s sudarshana says:

    Mr.Dev,
    The file for the late filing either by govt. dept or by private is enforceable and need to be complied. You will have to pay the fine. This is to be recovered eihter from the person who was responsible for the late filing or from the private agency if the fault lies wholey with them. If they are responsible for the delay same may be recpvered from the bill payable to them.

  15. s sudarshana says:

    Mr.Ratan, It is not clear weather you have not filed the return or filed without that TDS. If you have not filed file it now. If you have filed file the revised return under the option “voluntarily re-filing”.

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