Taxpayers who still need to file their return by the deadline of July 31, 2022, must file a delayed income-tax return (ITR) by December 31.
“This deadline applies to all categories of taxpayers, including individual, corporate, audit, and non-audit,” says Ankit Jain, partner at Ved Jain & Associates.
A belated return for the preceding year can be made at any time three months before the end of the relevant assessment year or before the conclusion of the assessment, whichever is earlier.
“It gives an additional opportunity to those taxpayers who missed the deadline owing to an unforeseen reason,” explains Maneet Pal Singh, partner at IP Pasricha & Co.
Benefits from forfeiture
Filing a late ITR is punishable under Section 234F of the Income Tax Act of 1961.
Assessees must incur a late filing penalty of up to Rs 5,000.
For small taxpayers with taxable income of less than Rs 5 lakh, the punishment is Rs 1,000.
Sections 234A, 234B, and 234C impose penalty interest depending on the type of tax owed.
Those who submit late returns are likewise prevented from carrying their losses forward.
“However, people are allowed to carry forward losses under the heading ‘Income from House Property,'” explains Aditya Chopra, managing partner of Victorian Legalis-Advocates & Solicitors.
Taxpayers who file a late return are ineligible for interest on I-T refunds, which are paid at a rate of 0.5% per month if the ITR is filed before the due date.
Regardless, file a late return.
Despite the disadvantages listed above, taxpayers should still submit a late return.
A person who must file a return but does not do so may face a penalty from the I-T department.
Singh claims, “You may dodge the repercussions of non-disclosure of income by filing a late return. You can also avoid receiving a notification from the I-T department for failing to file an ITR.”
If a taxpayer fails to file a return, the tax department may compute the person’s income based on its evaluation. This might be far more than the taxpayer’s actual income.
“If taxes have been taken from your income, you can still file a belated return and demand a refund of the extra taxes deducted,” Jain explains.
Regularly filing tax returns entitles a person to benefits such as increased life insurance coverage, faster processing of loan and visa applications, etc.
Use the co-browsing feature.
The I-T Department has added a co-browsing facility to the e-filing website, which allows helpdesk personnel to assist taxpayers in filling out their forms.
“This lets agents give tailored and real-time help to taxpayers when submitting an ITR,” explains Pratyush Miglani, managing partner at Miglani Verma & Co.
With only a few days till the end of the year, contact your tax professional to file your late ITR.
Do-it-yourself taxpayers and older folks can seek assistance from the I-T department’s agents.
Singh states, “They can only connect to the taxpayer’s screen for a session if the latter allows a request. The agents cannot view any other data on the taxpayer’s computer.”
Things to keep in mind
It is always advisable to file ITR on time. But if you fail to do so, then file a belated instead of skipping the return filing altogether.
Exercise a lot of caution while filing a belated ITR.
Singh says, “Be cautious about selecting the right ITR form. Also, keep all the documents handy while filing the return. Ensure that you disclose your income accurately, and cross-check every field in the pre-filled form.”
A belated ITR can be revised. However, if you file it at the last moment, you miss out on the chance to file a revised ITR if you discover a mistake later.
As a result, file early or be extra cautious if you file close to December 31.
Finally, if this deadline is missed, taxpayers can submit an ITR once they get a tax notification from the I-T Department.