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Penalty You Shall Pay For Missing ITR Filing Deadline, Have A Look


Have you come across the fact that the last date to file income tax return (ITR) has been extended to August 31, 2019 from July 31, 2019 for FY2018-19 without penalty? So, if you file your return after midnight i.e. after August 31, then you would have to pay a late fee of upto Rs 10,000. But again, if your income is below taxable limit then you won't have to pay it even if you file after the deadline.

The penalty you need to pay

A taxpayer is liable to pay late ITR filing fees of:

a) Rs 5,000 if tax return is filed after the deadline but on or before December 31 of the relevant assessment year (in this case December 31, 2019).

b) Rs 10,000 if tax return is filed after December 31 but before the end the relevant assessment year, i.e., before March 31 (in this case between 1 January 2020 and March 31, 2029).

For example, if you are a small taxpayer whose gross total income does not exceed Rs 5 lakh then the maximum fees you are liable to pay is Rs 1,000. This law of levying late filing fees under section 234F was introduced in the Budget 2017 and became effective for financial year 2017-18 or assessment year 2018-19 onward. Assessment year is the year immediately following the financial year for which the ITR is filed. The assessment year for the financial year 2018-19 is 2019-20.

Who will not be liable to pay?

Basically, chartered accountants are of the view that if a person whose gross total income does not exceed the basic exemption limit files a belated return, he/she will not be liable to pay penalty. But the current scenario is that the basic exemption limit for resident individuals below the age of 60 years is Rs 2.5 lakh. For senior citizens aged 60 years and above but below 80 years, income up to Rs 3 lakh is exempted from tax. For super senior citizens i.e. of age 80 years and above, the basic exemption limit is up to Rs 5 lakh.

Under Section 234F of the income tax return, for the tax filed after the deadline there will be no late filing fees to be levied if the gross total income does not exceed the basic exemption limit. "Section 234F draws reference of persons liable to pay late filing fees for filing belated income tax return from Section 139 of the Income-tax Act. Section 139(1) of the Act states that the following persons have to mandatorily file ITR: (a) a company or a firm/LLP irrespective of quantum of income and (b) any other person only if his total income exceeds the maximum amount not chargeable to tax, i.e., basic exemption limit."

What you should do?

Well there are some of you who will not be penalised for late filing your ITR, however, it is in your best interest to file ITR before the deadline if any tax refund is due. "This is because if the ITR is filed before the due date, then interest payable on tax refund will be calculated from April 1 of the relevant assessment year to the date on which refund is granted. In case a belated ITR is filed, even though no penalty will be levied as income is less than the tax-exemption limit, the taxpayer would lose out on some of such interest. In such event, interest will be calculated from the date of filing ITR to the date on which refund is granted."

As per the income tax slabs applicable for FY 2018-19, for resident individuals below 60 years, total income up to Rs 2.5 lakh is exempted from tax. For senior citizens aged 60 years and above but less than 80 years, total income up to Rs 3 lakh is exempted from tax. For super senior citizens aged 80 years and above, total income of Rs 5 lakh is tax exempt.