The December 31 deadline for filing an income tax return (ITR) for the financial year 2020-21 (the assessment year 2021-22) is over and those who have missed it shouldn’t worry. There still is an option to file the return by paying certain penalty charges.
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As per Income Tax (I-T) law, it is compulsory for individuals earning a specified amount of income in a year to file ITR within a pre-determined due date.
If the income tax return is not filed within the due date, a penalty along with interest under section 234A of the Income Tax Act is levied. The taxpayer is liable to pay simple interest at 1 percent per month or part of a month for delay in filing the return of income.
Such a filing is known as belated income tax return.
The penalty for filing ITR after the due date is up to Rs 5,000.
Generally, taxpayers are required to file ITR by July 31 of any year (unless extended by the government). The Central Board of Direct Taxes (CBDT) had extended the last date for filing ITR to December 31 in view of the coronavirus pandemic.
The process of filing a belated return is the same as filing the return on or before the due date.
In case an assessee doesn't file ITR at all, he/she will not be able to carry forward the losses of the current assessment year. A penalty may also be levied which is a minimum of 50 percent of the assessed tax or a maximum of 200 percent of the assessed tax. The assessee may have to face prosecution also (i.e. rigorous imprisonment for a term up to 7 years and fine), in extreme and high-value cases.
A person can claim the refund of the excess tax paid/deducted during a financial year by filing an ITR for that year. Also, ITR can be used as proof of income and address.
The process of filing a belated return is the same as filing the return on or before the due date.
First Published: Jan 3, 2022 5:09 PM IST
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