Demerits of filing return after due date .

Demerits of filing return after due date

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Demerits of filing return after due date

(1) Loss under specific head cannot be carry forward if return is not filed well in time.

According to section 139(3) of the Income Tax Act 1961, losses under ‘house property’ can be carried forward even if the return is not filed on time. However, losses under other heads of income, such as Profits and Gains of Business and Profession or Capital Gains, can be carried forward only if the return is filed by the due date.

(2) If the income tax return is not filed before due date than belated return is required       to be filed as per section 139(4) of Income Tax Act 1961.

The belated return should be filed after due date of filing of return but before the end of relevant assessment year.

For example : For the current assessment year, a belated return can be filed any time before 31st March 2019, if the assesse fails to file his return on or before 31st August 2018.

The process of filing a belated return is the same as filing the original return on or before the due date i.e. 31st July, 2018 (31st, August, 2018). The main difference would be that while filling the ITR form, you would have to select “Return filed under section 139(4)”

(3) Interest Penalty under section 234A of Income Tax Act 1961

If Income Tax Return is not filed on time and there is tax liability then Income Tax department can penalise by charging interest@ 1% on the outstanding tax amount under section 234A of Income Tax Act 1961.Interest will be payable from the 1st day after the due date of filing the return till the date of actual filing of the return. Any fraction of a month shall be considered as a full month for calculating interest.

(4) With effect from assessment year 2018-19, if return is not filed before due date           than penalty under section 234F of Income Tax Act 1961 is leviable

If assessee failed to furnish return of income within due date as prescribed under section 139(1) then as per section 234F of Income Tax Act 1961, he will be required to penalty of:

Rs. 5000 if return is furnished on or before 31st  December of assessment year.

Rs. 10,000 in any other case.

If the total income of the person does not exceed Rs. 5 lakhs then penalty of  Rs. 1000 is only leviable.


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