What happens if you miss the deadline of filing Income Tax Returns?

The deadline for filing income tax returns for individuals is upon us and if you haven't filed your ITR yet, you might want to avoid crossing the deadline. The government has not put any monetary penalties for crossing the deadlines. However, you would miss out on a lot if you file it even one day after the deadline. Here is how.

By: Express Web Desk | New Delhi | Updated: July 29, 2017 4:11 pm
Income Tax, income tax return, itr The deadline to file income tax returns in July 31. (Photo for representation)

The deadline for filing income tax returns for individuals is July 31. If you haven’t filed your ITR yet, you might want to avoid crossing the deadline. The government has not put any monetary penalties for crossing the deadlines. However, you would miss out on a lot if you file it even one day after the deadline. Here is how.

The penalty proposed for people people missing the deadline doesn’t apply till next year and it also doesn’t apply for ITRs filed for the financial year 2016-17. However, delays would could potentially lead to a loss of a lot of money.

Firstly, filing of returns is important now more than ever. This is especially important if you made cash deposits in your bank accounts over Rs 2 lakh during demonetisation which is November 9, 2016-December 30, 2016. It has been made mandatory to report such transactions for FY2016-17 or Assessment Year 2017-18. It is also likely that the IT department may contact you via written correspondence asking you to file your return in time.

Anyone who has registered with the Income Tax Department, has filed a return before, linked their Aadhaar with their bank accounts and/or PAN is most likely to get an sms from the IT department reminding them to file their ITR.

What are the losses?

If you want to claim refunds on advance taxes paid or on tax deducted at source, you will lose the interest payable to you by the IT department on the said amount. The IT department calculates the interest on refund from the start of the assessment year i.e. April 1 till the date of granting of refund.

However, if you file the returns late, the interest is calculated from the return filing date. For example, if you filed your return on July 31, the interest will be calculated from April 1. However, if you filed your return on August 1, the calculation will be done from August 1. So, the delay of even a day means loss of four-month interest (April-July)

You will also not be able to carry forward losses except in cases of loss from house property. You can’t carry forward losses from capital gains, business income, income from speculation business etc if you file your return after the deadline. Even if you have paid the tax in time, your losses will not be carried forward if you don’t file your return in time.

Late filing of return with unpaid tax liability

You will have to pay penal interest of 1 per cent per month from the due date of return filing till the actual day of filing if you file your return after due date with unpaid tax liability. This penalty can be accompanied by prosecution by the IT department if the return is filed later than the assessment year and if it exceeds Rs 3,000.

What if you don’t file the return in the relevant assessment year?

In case you fail to file your tax return by the end of the assessment year (for financial year 2016-17, assessment year is 2017-18) but you have paid all the tax liabilities, the tax department will impose a penalty of Rs 5,000 on you if you can’t convince them that the delay was justified or due to an unavoidable/uncontrollable circumstance.

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  1. Nandini Agarwal
    Aug 2, 2017 at 2:56 pm
    I heard that it is always good to file before the due date . While filing after due date has some issues . If you haven't filed yet , file with Tax2win . These people are experts
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    1. R
      rajvir Kaur
      Jul 31, 2017 at 8:38 am
      I have filled my ITR1 before due date and receive communication u/s143(1)a to respond by clicking eproceeding option buteproceeding shows no record.Please help me to respond through eproceeding menu.
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      1. D
        Dilip goswami
        Jul 30, 2017 at 2:58 pm
        How can IT return of resident but not ordinary resident can file the return without having aadhar card
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        1. #
          #AADHAARFAIL
          Jul 29, 2017 at 4:33 pm
          When your fingerprint gets stolen, printed and used for aadhaar pay, cloning SIM and changing bank password using OTP, your aadhaar devotion will vanish. Jai Hind. 1. 25 lakh families in Rajasthan are unable to withdraw ration even after seeding #AADHAARFAIL with their ration card. 2. #AADHAAR authentication does not work for half billion Indians. 3. AADHAAR authentication does not work even after updating bio-metrics and waiting for 90 days 4. AADHAAR bio-metrics can be stolen, printed and used for #AADHAAR pay 5. #AADHAAR does not work for NRIs, people outside India 6. AADHAR can not be generated if a person's fingerprint matches with someone else's with 60 percentage probability. 7. Rogue government can deactivate your #AADHAAR blocking ur gas, electricity, mobile, bank account 8. AADHAAR works for millions of illegals staying in India 9. AADHAAR is blocking subsidies for millions of legitimate people 10. Take 10 lakh insurance for each #AADHAAR failure case/delete
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          1. #
            #AADHAARFAIL
            Jul 29, 2017 at 4:32 pm
            Aadhaar product is SEVEN years old, authentication still fails for "Half Billion" indians, millions of honest tax payers are unable to link aadhaar with PAN, UAN, etc. #AADHAAR's right place is in dust bin, it has wasted billions of dollars of tax payers money. When your fingerprint gets stolen, printed and used for aadhaar pay, cloning SIM and changing bank password using OTP, your aadhaar devotion will vanish. Jai Hind. 1. 25 lakh families in Rajasthan are unable to withdraw ration even after seeding #AADHAARFAIL with their ration card. 2. #AADHAAR authentication does not work for half billion Indians. 3. AADHAAR authentication does not work even after updating bio-metrics and waiting for 90 days 4. AADHAAR bio-metrics can be stolen, printed and used for #AADHAAR pay 5. #AADHAAR does not work for NRIs, people outside India 6. AADHAR can not be generated if a person's fingerprint matches with someone else's with 60 percentage probability. 7. Rogue government can deactivate #AADHAAR
            (0)(0)
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