The due date for filing income tax returns for individuals is July 31, 2017. The deadline is fast approaching and most taxpayers have already filed their ITR or in process of doing so. However there are people who may not be able to file their returns before due date or are too lazy to file their returns. The question is what happens if you do not file your returns before due date?
The good news is as per existing laws and provisions there are NO penalties. But Budget 2017 has changed this. From next Assessment year 2018-19 onwards you will have to pay penalty of Rs 5,000 if the returns are not filed by due date but before December 31. In case there is further delay the penalty would be Rs 10,000. However, in case the total income is less than Rs 5 lakh, the penalty should not exceed Rs 1,000. So from next year being lazy in filing returns would cost money too.
Here are some posts which can help you with e-filing of ITR 2017:
Though there are NO fines or penalty this year but you still loose on various other benefits. We have listed them below for you.
Impact of late filing of tax return:
1% Monthly Late payment fee on tax due: In case after adding up all the TDS, advance taxes or self-assessment tax, if there is any tax payable from your side, you will need to pay monthly 1% late fee on the amount due for each month of delay.
Late refund: if you file your ITR late, you will also get your excess tax paid refunded late. This is a loss as you could have put to the money to better use and you obviously loose on the interest part.
Cannot carry forward your losses: you cannot carry forward following losses in case of delayed filing:
- Speculation loss,
- business loss excluding loss due to un-absorbed depreciation and capital expenditure on scientific research,
- short term capital loss,
- long term capital loss,
- loss due to owning and maintenance of horse races
- However you can still carry forward loss from House property.
A lot of publications are reporting that you cannot revise your returns in case the ITR is filed after due date. This is NOT true and Budget 2016 has changed this. Starting this year you can revise your belated returns.
Budget 2016 has also limited the time period for filing your tax returns. Starting FY 2016-17 (AY 2017-18) you would not be able to file your returns after the end of assessment year. This means you cannot file your returns for FY 2016-17 (AY 2017-18) after March 31, 2018 without intervention from income tax department.
What if you don’t file AY 2017-18 return even by March 31, 2018?
In case you miss the March 31, 2018 deadline then you would not be able to file your returns without I-T Department intervention. Also, the tax officer has to do your tax assessment based on best information he has resulting in increased tax liability.
So stop being lazy and file your income tax returns before due date even if you have NO tax dues and have peace of mind. It’s easy to do and out tutorials on the same would help you with the same!