As responsible citizens, we all know that it is very important to file income tax returns (ITR) on time. This time around, the deadline to file ITR for the financial year 2020-2021 has been extended to December 31, 2021. In fact, the due date for ITR filing for the assessment year 2020-2021 has been extended twice—first from July 31, 2021, to September 30, 2021, and then to December 31, 2021.
If you miss this deadline and are unable to file your ITR by December 31, there could be repercussions. However, if you have filed the returns but not verified it, there’s no need to worry. As per the present tax laws, you could verify your return within 120 days of filing it.
What Happens If You Don’t File ITR On Time
The income tax department will send you a notice telling you to file your return but there will be a penalty to pay. Remember that this penalty will balloon if some tax remains payable on your behalf. “If you are found to owe the government taxes, the interest keeps adding up till you pay. A penalty of up to Rs 10,000 may also be levied,” says Archit Gupta, founder and CEO, ClearTax, a tax portal.
Apart from the late fees levied under Section 234F of the Income-tax Act, 1961, there are other consequences that a taxpayer may face for late filing of returns. “In such cases, they might not be able to carry forward their losses (other than house property loss) in subsequent years. They might face delays in getting the refunds of excess taxes paid. They could lose out on interest amounts as the interest in case of refunds shall be calculated from the date of the filing of the belated return,” says Sehgal.
“Also, interest under Section 234F will be charged from the original due date that is July 31, 2021, if the tax liability is more than Rs 1 lakh. The interest income tax return cannot be filed after the last date which is, at present, March 31, 2022, for FY 2020-2021,” says Ruchika Bhagat, chartered accountant and MD of Neeraj Bhagat & Co, a chartered accountancy firm.
What You Can Do If You Miss The Deadline
If a person required to file ITR under section 139 of the Indian Income-Tax Act, fails to do so on time, they may file the belated return of their income before 31st March of the assessment year (AY) which is 31st March 2022. Also, the taxpayer would require to pay a fee u/s 234F of the act for late filing of the return. “The late fee amount would be Rs 5000 for every taxpayer, however, there is a relief given to small taxpayers- if the total income of such taxpayers does not exceed Rs 5 lakh, the maximum late fees levied for delay will be Rs 1000,” says Sandeep Sehgal, director- tax and regulatory, AKM Global, a tax and consulting firm.
What You Can Do If You’ve Made An Error While Filing
After tax filing, if you realise that you have missed out mentioning some information, or not reported certain incomes or deductions, or made a mistake inadvertently, it is possible to file a revised return. The last date of filing the revised return for FY2020-21 has been extended to March 31, 2022. Also, remember, the last date to file belated and your revised return is March 31, 2022.
