Why you should file belated Income Tax Return (ITR) before December 31

Why you should file belated ITR before 31 st December

If you have not filed your income tax return (ITR) for FY2017-18 till now, it is high time you get a move on.

According to newly inserted law, i.e., Section 234F of Income Tax Act , if an individual who files the ITR after the expiry of the deadline (i.e., belated ITR) will be required to pay a late filing fee maximum up to Rs 10,000. However, the fee to be levied is based on the time period of delay which is as follows:

a) A fee of Rs 5,000 if the ITR is filed after the due date but before December 31 of the relevant assessment year (December 31, 2018 in this case), or

b) Fee of Rs 10,000 in case ITR is filed between January 1 and March 31 of the relevant assessment year (January 1, 2019 – March 31, 2019).

Therefore, if you still haven’t filed your ITR it is best to do it before December 31, 2018 to avoid paying higher penalty on late filing of ITR. However, for taxpayers whose income does not exceed Rs 5 lakh in a financial year, the penalty is restricted to Rs 1,000 for belated ITR filed up till March 31, 2019.

Remember that apart from paying a late filing fees, if there is an unpaid tax liability, then you would be required to pay that as well along with the interest on it. The department penalises you by levying interest at the rate of one per cent per month or part of it if taxes are not paid within the due dates under Section 234A. The interest payable is calculated from the due date of filing of return till the date return is filed.

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