ITR MISSED?? Here’s what you can do

The Government of India (GoI) imposes a tax liability on taxable income of all persons as defined under the Income Tax Act, 1961, who are individuals, Hindu Undivided Families (HUF’s), companies, firms, LLP, association of persons, body of individuals, local authority and any other artificial juridical person.

An Income tax return (ITR) is a form used to file information about your income and tax to the Income Tax Department. The tax liability of a taxpayer is calculated based on his or her income. The Income Tax Return (ITR) must be filed every year on or before a specified / due date.

  • Due Date for FY 2020-21:

The income tax return (ITR) filing deadline for FY 2020-21 was December 31, 2021 and the same was not further extended by the Ministry of Finance, Government of India. 31st December, 2021 was the last day to file Income Tax Return (ITR) for Assessment Year 2021-22.

There is no need to worry if you are among taxpayers who have not filed ITR by the due date i.e. on or before 31.12.2021, as the process can be completed by March 31, 2022 by filing Belated ITR and the last date to submit Belated ITR for AY2021-22.

  • File ITR After Due Date – Called “Belated ITR”:

If the income tax is filed after the due date, it is called a ‘belated return’. However, for this, the taxpayers will need to pay a penalty fee, as fixed in the Finance Act.

Those who were not able to file their returns by the due date, i.e. by 31.12.2021 (extended due date) can still do so but they have to pay penalty fee for late ITR filing.From FY 21 or Assessment Year 2021-22 (AY22), the penalty amount for late filing beyond ITR filing deadline was reduced to Rs 5,000 from Rs 10,000 earlier.

As per Income Tax Act, 1961 Provisions:

  • the belated ITR can be filed up to March 31, 2022 with a penalty of ₹5,000.
  • If the total income does not exceed ₹5 lakh, then taxpayers will pay a fine of ₹1,000 only.
  • There is no late fee for those whose income is below the exemption limit (₹2.50 lakh).

Under the new tax regime, which does not provide any tax deduction, the basic exemption is Rs 2.5 lakh per irrespective of the age. But in the new tax regime, the basic exemption limit is decided as per age bracket. For those under age of 60 years, the basic exemption is Rs 2.5 lakh and Rs 3 lakh for those aged over 60 but below 80. For those over 80, it is Rs 5 lakh.

Those who have already filed their ITR can also file a revised return if there was a lapse in filing the original tax return. The last date to file revised income tax returns for assessment year 2021-22 is March 31, 2022.

  • one-time relaxation to ITRs pending for e-verification

The Central Board of Direct Taxes (CBDT) has given one-time relaxation for the verification of e-filed ITRs, which are pending e-verification. The decision was taken amid complaints of glitches in the e-filing portal of the income tax department.An income tax return filed without a digital signature needs to be verified electronically within 120 days of filing the return.

Those who could not complete the ITR-V verification for 2019-20 can do it by February 28, 2022. The one-time relaxation was provided by RBI towards the end of 2021.

  • Non – Compliance is very expensive:

Penalty for not filing ITR on time – Belated ITR:

  1. DueDate filing of belated ITR for AY 2021-22 is 31st March 2022.
  2. According Section 234F and provisions made under the Income Tax Act, 1961, the penalty for belated ITR could be up to Rs 5,000/-.
  3. Kindly note that, in case where total incomeof the Taxpayer is not more than Rs 5 lakh in a financial year, the maximum penalty for the delay is Rs 1000.
  4. Taxpayers also have to pay penal interest on any unpaid tax liability if filing belated ITR.
  5. Kindly note that
  • Belated ITR filers cannot carry forward losses under any head of income (other than income from house property).
  • This facility is available only when the ITR is filed within the due date. However, loss under the head of income from house property can be carry forwarded.

DisclaimerEvery effort has been made to avoid errors or omissions in this material. In spite of this, errors may creep in. Any mistake, error or discrepancy noted may be brought to our notice which shall be taken care of in the next edition. In no event the author shall be liable for any direct, indirect, special or incidental damage resulting from or arising out of or in connection with the use of this information.