The Government frames Indian Income Tax Laws. The government levies a tax on the taxable income of all individuals, Hindu Undivided Families (HUFs), companies, firms, LLPs, associations of persons, associations of individuals, local authorities, and other artificial legal entities. Under these laws, tax collection per person depends on their residential status. Any individual who qualifies as a resident of India is liable to pay an income tax return on his global income. Every financial year, taxpayers must follow specific rules during ITR filing.
What is ITR filing or Income Tax Return filing?
An Income Tax Return is a form that is supposed to submit information regarding your income and taxes to the Income Tax Department. The taxpayer's tax liability is calculated based on his income. If the return shows that an overpayment of tax has been made during the year, the individual will be entitled to a refund of income tax from the Income Tax Department.
According to income tax laws, ITR filing must be done annually by an individual or a business with any income during the financial year. Payment can be in the form of business profits, salary, income from house property, or earned through dividends, capital gains, interest, or other sources. A natural or legal person must file an income tax return by a specific date. If the taxpayer doesn't comply with this deadline, he must pay a fine. In this article, we will discuss what will be the consequences if you miss the deadline for income tax return filing. But first, let us understand how vital ITR filing is.
Is it compulsory to file an income tax return?
As per the tax laws set in India, it is compulsory for you to file an income tax return in case your income exceeds the basic exemption limit. The rate of income tax is already mentioned for the taxpayers. Delays in filing ITR will not only attract late filing fees but will also limit your chances of getting a loan or a travel visa.
The ITR filing for the financial year 2022-23 (the assessment year 2022-23) is until 31 July 2022. It is advisable to file income tax before the due date, that is, before 31 July 2022. However, if, for some reason, the income tax return filing is not done by the deadline of July 31, 2022, the following will be the consequences. Explore to find out what will happen and what options a taxpayer who wants to file their ITR contribution has before the deadline.
Penalty on late ITR filing
The due date of delayed Income tax filing online is 31st December 2022 for FY 2021-22 (AY 2022-23) unless extended by Govt. If the Income tax return filing is completely after the due date (July 31) and before December 31, 2022, a late filing fee will be charged. A late filing fee will be charged if you file your tax return late, that is, after the deadline. Till Assessment Year 2017-18, there was no penalty for late filing. This penalty came into action from AY 2018 - 19. In the Income Tax Act of 1961, the government inserted a new section 234F. This section was further amended in the 2021 budget.
The amendment came about because the government reduced the deadline for filing a belated ITR by three months. Until FY 2019-20, an individual had the option to file a belated ITR by the end of the relevant assessment year, that is, by March 31. However, in the 2021 budget, the government has shortened the deadline for filing delayed ITR by three months, that is, to 31 December. Hence, a subsequent amendment was made under section 234F to reduce the penalty levied for late filing of ITR by half.
It is also important to note that if you have any unpaid tax liability, you will be charged a penalty interest on it, which applies to your case if you file an income tax return late. However, if no tax is due, the taxpayer will not be liable to pay this interest only because of the late ITR filing.
How to file a late income tax filing online?
The process for filing a late return is the same as filing a return till the due date. The main difference will be that while filling out the appropriate ITR form, you would have to click on "Return filed under section 139(4)" from the drop-down menu in the right field of the form. Also, note that if you are filing a late return for FY2021-22 (AY 2022-23), you have to file the relevant ITR as notified for FY 2021-22 only and not for any previous or later FY.
Can you revise the delayed ITR?
Yes, you can. From FY16-17, that is, AY17-18 onwards; you are allowed to revise the belated return. However, if you file an income tax return after the deadline, you will lose some benefits and be assessed a penalty.
What if I filed a return, but there was an error?
If, after filing the tax return, you discover that you have not declared some income or that some deductions have not been used in the calculation of the return, it is possible to submit a corrected return.
The last date for filing the revised return for the financial year 2021-22 is December 31, 2022.
Note that the last date for filing late and corrected returns is the same for FY 2021-22, that is, 31 December 2022. So, suppose you submit a late ITR on 31 December 2022. In that case, you can still correct your tax return online on the last day (that is, December 31, 2022, on or before midnight) if you discover an error after submitting it electronically.
How much time do I need to verify my return?
Just filing your tax return is only half the process – you also need to verify it. Under current tax laws, you can verify your return within 120 days of filing it.
Lawgical India is one such company that will help you file your income tax return. Lawgical India is a leading legal service provider that specializes in ITR filing. If you are searching for a company or legal firm to do your taxes, then Lawgical India is the best for you.
Let us understand how vital ITR filing is.
