ITR filing: Penalties you may have to pay if you miss July 31 deadline

A fee of Rs 5,000 is levied under section 234F of the Income-tax Act, 1961 for filing a belated return.

Individuals who are not liable to file ITR but still want to file the returns can do so even after the due date without any penalty.

Now, if taxpayers do not file ITR at all, they will not be able to carry forward the losses of the current assessment year. Also, a penalty may be levied, which is a minimum of 50 percent of the assessed tax or a maximum of 200 percent of the assessed tax.

Additionally, an assessee may have to face prosecution (i.e. imprisonment for a term up to 7 years and a fine) in extreme and high-value cases. This happens when wilful default to furnish the return of income and tax payable (after reducing taxes paid and TDS) exceeds Rs 10,000.

Well, they can apply for condonation of delay and file an online return. For example, if Mr X missed filing ITR for FY 2020-21 by March 31, 2022, he can request a condonation of delay through the e-filing portal and file an online return.

If the return is filed within the due date, taxpayers can carry forward losses to subsequent years, which can be used to set off against income of subsequent years.

ITR helps individuals when they have to apply for a vehicle loan or house loan. All major banks can ask for a copy of tax returns. It can also be used as proof of income and address. Most embassies and consulates require individuals to furnish copies of tax returns for the past couple of years at the time of the visa application.