Wondering how to save your taxes? Filing your Income Tax Return (ITR) on time is important. Whether you’re a salaried individual, a freelancer, or running a business, missing the due date for filing an ITR can cost you more than you might think.
Let’s understand in simple terms so you can easily understand what happens when filing a late income tax return. Understand what Section 234F of the Income Tax Act says and the penalty for late filing of the income tax return.
What’s the Due Date for Filing ITR?
For most individuals in India, the due date for filing ITR (Income Tax Return) is:
- 31st July of the assessment year (for example, for income earned in FY 2024–25, the due date would be 31st July 2025).
If you’re a taxpayer whose accounts need to be audited, like businesses or professionals with income over certain thresholds, the deadline is usually extended to 31st October.
The government may change or extend these dates occasionally, especially during extraordinary times like the COVID-19 pandemic, but it’s always best to aim for the standard deadline.
Steps to File Your ITR
If you’ve never filed before or want to be sure you’re doing it right, here’s a quick guide:
- Collect Documents: This includes your PAN, Form 16, bank statements, TDS certificates, interest income statements, etc.
- Choose the Right ITR Form: Based on your income sources, like salary, business, capital gains, etc.
- Log in to the Official Portal: Use www.incometax.gov.in to file your return online.
- Fill in the Details Carefully: Follow the instructions and double-check the data.
- Verify Your Return: This can be done using Aadhaar OTP, net banking, or sending a physically signed copy to CPC, Bangalore.
What Happens if You File Late?
Even if taxpayers have no income tax liability, they might have to pay this simply for filing the IT return late. Also, if a taxpayer’s total income is below ₹2,50,000, there is no penalty to pay for this form because it is not compulsory for taxpayers to file returns.
Let’s discuss what happens if you miss the due date. Section 234F of the Income Tax Act outlines the penalty for late filing of income tax returns.
Here’s how the penalty works:
| Date of Filing | Income Below ₹5 Lakh | Income Above ₹5 Lakh |
| Filed after the due date but before 31st December | ₹1,000 | ₹5,000 |
| Filed after 31st December but before 31st March | ₹1,000 | ₹5,000 |
Other Consequences of Late Filing
The penalty is not the only result of late filing. You must consider some other consequences if you delay filing your taxes.
1. You Missed the Chance to Carry Forward Losses
If you have made any capital losses, such as selling stocks or properties, you can only forward your losses to the next year if you file your return on time. Filing late means the benefit stated above will not be accorded to the filer.
2. Delayed Refunds
If you expect a refund, a delayed return also means a delayed refund. The fact is that when the form is sent in early, the money will be processed and returned to the sender quickly.
3. Interest on Unpaid Tax
If you have the sum, as per Section 234A, there would be an interest charged for the tax amount unpaid as well. This is so because it is completely different from the penalty under Section 234F.
4. Legal Trouble
In a few circumstances, including tax evasion or a delay in filing the returns, the Income Tax Department may prosecute. This is not very often possible, but it is good to avoid cases of doubt.
Benefits of Filing ITR on Time
Let’s now see what the benefits of filing ITR on time are.
| Benefit | Details |
| Avoid Penalties | You are not liable to pay any fine per section 234F of the Income Tax Act if you file your income tax return before the due date. |
| Get Your Refund Faster | If a deduction is made, it will be on a TDS basis, and the tax amount refundable will be received early if the return is filed as soon as possible. |
| Builds Financial Reputation | A clean tax record is advantageous when looking for credit, jobs, visas, investments, or any credit facility. |
| Claim Deductions and Carry Forward Losses | Filing on or before the deadline enables one to claim tax-saving investments and bring forward losses for the next year. |
| Peace of Mind | It saves time and avoids a last-minute rush; it is easy to do, and any technicalities do not arise at the last minute. Hence, there is no stress. |
Can You Still File After the Due Date?
Yes, you can. The return filed after a certain period is known as a belated return. A belated ITR can be filed up to the end of the particular financial year or assessment year with some conditions, fines, and interest.
For instance, if a WBS due date is stated to be 31st July 2024, you can file up to the end of 31st March 2025; however, you will be charged a fine, and some of the benefits of submitting it on time will not apply to you.
Filing on Time is Filing Smart
Filing your ITR on time is not just about avoiding punishment; it helps manage your monetary affairs. The penalty under Section 234F of the Income Tax Act can easily be eliminated by adopting a few discipline measures.
The good news? This indicates that filing online is easier compared to the past. Therefore, whether you are a first-timer at filing income tax returns or someone who has been doing this several times a year, do not wait until the last minute. You can also be a part of Dhan’s Made For Trade Community to learn from experienced investors, go through real case studies, and stay informed about the latest market updates.
