Quick notes on Late fees under section 234F of Income Tax Act 1961

In this article, we will discuss some points about section 234F which can bring some clarity about application of the section.

As we know that if the return of income is not filed on or before due date as per section 139, we have to pay late fee of Rs. 5000/- under section 234F. However amount will be restricted to Rs. 1000/- if the total income of the assessee does not exceed RS 5,00,000/- Following are some of the points which can bring some clarity on application of the section.

• Section 234F is “Fee for default in furnishing the return of income” which means that section 234F is not only for late filing of return of income but also for non-filing of return of income. For example that if the return has not been filed by the assessee and the assessing officer makes best judgement assessment under section 144, along with tax, interest and penalty, fee under section 234F will also have to be paid by the assessee.
• Fee under section 234F is applicable only when person is required to file return of income as per the provisions of the income tax act so if a person who is not required to file return of income as per income tax act files return of income voluntarily but after the time prescribed under section 139, he will not be liable to pay fee under section 234F. For example, If an individual has business loss, he is not required to file return of income but if he files it voluntarily but after the due date, he will not be liable to pay fee under section 234F. However in that case since the return is filed belated, he will not be able to carry forward the business loss.
• Fee under section 234F is applicable on return filed under sub section 4A, 4B, 4C, 4D, 4E and 4F of section 139 as well.
• If the assess has not filed the return of income where he was required to filed the same and subsequently notice under section 142(1)(i) is served upon him requiring him to file return of income within the time prescribed under the notice, the assessee will have to pay fee under section 234F.
• If best judgement assessment has been done by the assessing officer, assessee will have to pay fee under section 234F as well.
• Fee under section 234F has to be paid as self assessment tax before filing of return of income.
• If the assessee has paid fee under section 234F, it is a deductible expenditure under the head P/G/B/P.

I hope this will help. Thank you.

Disclaimer: The information contained in the above article does not constitute professional advice or a formal recommendation. The author shall not be liable for any loss or damage caused to any person, directly or indirectly, for any action taken on the basis of the above article.