Filing Income Tax Return after the Due Date
People tends to miss due date of filing tax return due to lack of time or no planning.
Due dates of Filing Tax Return is provided under section 139(1)
|Where the assessee is a Company||30th September of the Assessment Year|
|Where the assessee is a person other than a company:-
||30th September of the Assessment Year|
|Any other assessee||31st July of the Assessment Year|
But an assessee can also file belated tax return under section 139(4) upto 2 years from the end of financial year in which income earned. For example Tax Return for Financial year 2011-12 can be filed upto 31st March, 2014.
Filing of belated return also attracts penalty which could be categorized as:
Case 1: No Tax Liability Pending
Where tax on income of assessee has already paid in form of TDS, Advance Tax, etc then the tax return can be filed till the end of assessment year without any penalty but if filed after the end of assessment year then penalty of Rs.5,000 u/s 271F, will be levied.
For example tax return of assessment year 2013-14 must be filed upto 31st July, 2013 (considering individual) but if no tax liability is pending then ITR can be filed upto the end the assessment year i.e. 31st March, 2014. In case assessee also failed to file ITR upto this date then by paying penalty of Rs.5,000, assessee can file ITR upto one year from the end of assessment year i.e. 31st March, 2015. Penalty in this case is on discretion of Assessing Officer.
Case 2: Tax Liability Exists
Sometimes assessee forgets to consider few incomes such as if he had worked under two employers but forgets to show salary received from first employer, thus owes taxes to the Government. The return filing date without penalty of Rs.5,000 remains same i.e. till the end of assessment year but interest of 1% shall be levied on the amount of unpaid tax u/s 234.
For Example: Mr. Sanyam’s Net Tax Liability for A.Y. 2013-14: Rs.50,000
- TDS deducted by employer: Rs.35,000
- Self-Assessment or Advance tax paid: Rs.5,000
- Balance Tax payable by Mr. Sanyam: Rs.10,000 (50,000 – 35,000 – 5,000)
Suppose Mr.Sanyam files the tax return on 15th, November 2013 (before the end of the assessment year but after the due date)
In this case if Mr. X would be liable to pay simple interest on tax unpaid for 4 months (from August to November) but no penalty.
- Tax Payable would be 10,400 [10,000 + 4%(10,000)]
Suppose Mr. Sanyam files the tax return after the end of the assessment year on 10th July, 2014 (i.e. after 31st March, 2014).
In this case, he will liable to a penalty of Rs. 5,000 u/s 271F along with the penalty of 1% on balance tax payable for 12 months (August, 2012 to July, 2013).
- Tax Payable is 16,200 [10,000+5,000+(12%(10,000)]
Case 3: Carry Forward Losses
One need to take utmost care in this situation because as per section 80 if assessee fails to file tax return within prescribed time u/s 139(1) then he will not be able to carry forward the loss of that year and thus looses the benefit of set off of these losses against the income of next year. However, there is an exception to this rule i.e. this rule is not applicable on the losses from house property, which means House Property losses can be carried forward even if the income tax return is filed after the deadline.
Case 4: Tax Refund instead of Tax Liability
In case Government owes money to you i.e. you have any Tax refund then you can file the return even after 31st July of the assessment year without any issue. The only disadvantage will be that your refund will be processed late and you will get your money late.
- No revision is possible of belated return (Return filed after the due date).
- There are few limitations of filing belated return.