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File tax returns before deadline

Taxpayers should file tax returns on time. Thus, you can revise returns, carry forward losses and get refunds on time.

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The article talks about the outcomes of filing late returns. Many taxpayers continue to file late returns even after the process of ITR has become online. The article mentions that you may have cleared all dues but, if you do not file returns on time, your case may be picked up for scrutiny.

Vaibhav Sankla, director of tax consultancy firm H&R Block, cautions, if you file the return after the deadline i.e. July 31 and realise that you have committed a mistake in it, then you will not be able to revise your returns. He also adds that if a taxpayer has an outstanding tax, then he/she is required to pay interest on the due u/s 234A. By the way, this rule is not applicable for those expecting a refund.

Another demerit of filing a late return is that it leads to a delayed refund. In case the refundable amount is more than 10 percent of the total tax payable, one is entitled to receive interest on that amount (simple interest of 0.5%). But, again late filers have to forfeit the interest on the pending refund for the period of the delay.

Sankla points out that late return filers cannot carry forward losses in investment (equity or mutual funds). Exceptions are a

loss from house property and unabsorbed depreciation. Only these can be carried forward if you do not file returns by the deadline.

Taxpayers should keep in mind that tax returns are needed for visa applications.

You can file belated returns for the next two years. But, one should shy away from filing late returns as this may attract a penalty of Rs.5000.

Source : Business Standard