Despite being well aware of the due date for filing income tax returns which is July 31, many taxpayers fail to complete the process on time. That, however, does not mean that they have missed the chance to file their returns altogether. All assessees are permitted to file returns pertaining to up to two preceding financial years even after the due date.
Now, filing a belated return is not without its share of hitches. However, the good news first. Latecomers are allowed to file their returns until the end of the assessment year. That is, for the current assessment year 2018-19 (financial year 2017-18), you can file a belated return until March 31, 2019.
Now, the bad news. Despite the lifelines on offer, it is best to e-file your income tax returns on time, especially if you have any tax payable, in which case you might be charged a penal interest of 1% on the amount for every month of delay post July 31. You may have to forgo the benefit of carrying forward losses incurred under the head ‘Capital Gains’, ‘Income from other sources’ or ‘Business and Profession’, which could have otherwise reduced your tax outgo in the subsequent assessment year. Moreover, you could also lose out on any interest due on tax refund from the I-T department. Besides, the processing of your tax refund, itself, could get delayed.
The late filing fee will also come into the picture for all taxpayers who fail to file their returns by the due date. If your income exceeds Rs 5 lakhs and you don’t file ITR by July 31, then you will be asked to pay a late filing fee of Rs 5,000. If you further delay the task and don’t file ITR by December 31, then you will end up paying Rs 10,000 as the late filing fee. This fee is limited to Rs 1,000 for late filers with income below Rs 5 lakhs.
Given the complications involved in deferring returns filing beyond the due date, it is best to aim for timely filing of tax returns, notwithstanding the grace period available to you.
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