Is there any penalty for late filing of ITR?

Wondering if there is any late fee for ITR? Yes, there are penalties for late filing of Income Tax Returns (ITR) in India. The penalties and consequences vary depending on the delay period and the taxpayer's total income. 

What is ITR Late Fee?

Here’s a detailed explanation of the penalties for late filing of ITR:

For Filing after the Due Date (Section 234F):

• Small Taxpayer: If the total income does not exceed ₹5 lakh, the penalty is ₹1,000. This penalty is applicable if the return is filed after the due date but on or before December 31 of the assessment year.

• Others: For other taxpayers, if the return is filed after the due date but on or before December 31 of the assessment year, the penalty is ₹5,000. If the return is filed after December 31 but before March 31 of the assessment year, the penalty increases to ₹10,000.

Consequences of Late Filing:

• Interest on Tax Due: If there is any tax payable after considering TDS and advance tax, interest under Section 234A is levied at 1% per month or part thereof on the tax amount due.

• Loss of Certain Benefits: Delay in filing ITR may result in loss of certain benefits like carry forward and set off of losses (except loss from house property), belated filing of revised returns, and claiming refund.

Revised Return Filing:

If a taxpayer discovers any error or omission in the original return filed, they can file a revised return within the prescribed time limit without attracting penalties.

Avoiding fine for late ITR filing

• Timely Filing: File your ITR by the due date to avoid penalties and interest charges.

• Correct Information: Ensure all information provided in the return is accurate and complete.

• Advance Tax Payments: Pay advance tax if applicable to avoid interest charges on late payment.

It’s crucial to file your Income Tax Return on time to avoid penalties and consequences. The penalties vary based on the delay period and the taxpayer's income, with provisions allowing for reduced penalties for smaller taxpayers. 

This is all about late fee for ITR.

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It is important to file ITR within the due date. Late ITR filing penalty and other repercussions could result from missing this deadline. Let us go through these penalties.

Is There any ITR Late Filing Penalty?

• If the taxpayer intentionally disregards notices and fails to file a return, the income tax officer may begin prosecution. A penalty for non filing of ITR may accompany a sentence of three months to two years in prison. The prosecution term may go up to seven years if you owe the income tax agency more money.

• According to Section 234A, interest will be assessed if your income tax return is filed beyond the deadline. The unpaid outstanding tax amount is subject to an interest rate of 1% per month, or a portion thereof.

• If the income tax return is filed beyond the deadline, Section 234F imposes a late fine of Rs. 5,000. A late fee of Rs. 1,000 is imposed if your total income is less than Rs. 5 lakhs.

• It is not permitted to carry over losses to succeeding years (except from losses to real estate). If the return is not filed by the deadline, these losses cannot be offset against future earnings. Carrying forward losses is allowed, though, if they relate to housing property.

• If you are eligible for a refund from the government for overpaying taxes, you have to file your returns by the deadline in order to get your money back as soon as possible.

Hope this information helps!

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Here is something you should take care of- filing your taxes on time! Did you know if you fail to pay your taxes on time, you need to pay a lump sum amount as penalty? It’s true! I will briefly discuss ‘Is there any penalty for late filing of ITR?’ 

How much is the penalty for late filing of ITR?

According to the changed rules stated under 23F of the Income Tax Act, filing taxes after the deadline can make you charge a maximum penalty of Rs. 5,000. 

Last year in 2021, the Income-tax Department decreased the maximum amount of penalty for filing tax after the deadline. Earlier the penalty for late filing was Rs. 10,000. Now, it is Rs.5,000.

You should know that if you have filed your ITR before 31st December 2021 (15th February 2022 for audit and 28th February 2022 for transfer pricing cases) you won't be charged a penalty.

So, any person who gets an annual salary of Rs. 5 lakh and above has to pay a Rs.5,000 penalty if they pay their taxes after the deadline. Small taxpayers who have an annual income of less than Rs 5 lakh need to pay a Rs 1000 penalty. 

Penalty on late filing of ITR:

If you have made any mistake while filing income tax, you will have a 1-year window to revert the changes.

As per Section 234A if you fail to pay tax on the due date you need to pay interest at the rate of 1% for every month or part of the month on the amount you need to pay taxes.

I hope this answers your question ‘Is there any penalty for late filing of ITR?’

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