Delayed ITR filing may result in a prolonged wait or loss of the receipt of the tax refund.
Over 6.50 crore income tax returns (ITRs) were filed for the financial year 2023-24 till 6:30 PM on July 31-- the last day of tax filing. As expected, the Income Tax department has not announced any further extension in the window to file ITRs. Taxpayers who failed to file the return within the stipulated time can still file their belated ITR with a late fee.
Here is a list of options available to taxpayers in case they failed to file the ITR on or before July 31:
Belated ITR Filing
Taxpayers can file their belated ITR on or before December 31 along with a late fee of Rs 5,000. In case the taxpayer's total income is less than Rs 5,00,000, the penalty shall be limited to Rs 1,000. For those whose income is less than the exemption limit, there will be no late filing fee. Apart from the late fee, belated ITR will also invite penalty interest at the rate of 1 per cent per month on the taxable amount. The interest will be applicable on the net taxable income after the deduction of TDS (tax deducted at source), TCS (tax collected at source), advance tax and other reliefs/ tax credits available under the law. While calculating the penalty interest, even a single-day delay will be charged with an interest for a month.
Drawbacks Of Belated ITR Filing
Belated ITR filing comes with its own set of limitations. Not filing the ITR before the due deadline will lead to a loss of carry forward of losses— business and capital— for future years. However, it must be noted that under the header "income from house property" or unabsorbed depreciation may still be carried forward.
Taxpayers are eligible to receive interest on excess tax deductions only after filing the returns on time. Delayed ITR filing may result in a prolonged wait or loss of the receipt of the tax refund.
In case a taxpayer filed the ITR online before the deadline but could not E-Verify the filing, they can do so within 30 days without any penalty. Failure to E-Verify your income tax return may result in rejection of the filing.