Penalty for late filing of Income Tax Return – Sec 234F

Written by Ravi Sankar Robbi

Updated on:

Amongst all compliances, Income tax compliances gather the attention of most individuals, particularly the salaried class. Adhering on time will ease the burden, whereas non-compliance will lead to penalties and certain consequences.

So let’s find out what happens when you fail to furnish your Income Tax Returns (ITR) within the due dates specified by the Income Tax department.

Introduction

A new section has been introduced from AY 2018-19 which deals with levying a late fee for furnishing income tax returns beyond the due dates specified under sec 139(1).

As long as you are filing the returns on time this section does not get triggered. But when you fail to do so, you need to pay an additional fee of up to Rs. 5,000 in addition to your tax liability to file your tax returns.

Due date to file ITR

Different due dates have been specified under the Income Tax Act based on the category of Person.

The due date for filing the income tax return for AY 2024-25 i.e. FY 2023-24, for the individuals and other assessees not covered under the audit is 31st July 2024.

How much late fee?

The amount of late fees depends on the total income of the taxpayers, which is as follows:

Total IncomeLate Fee u/s 234F
More than Rs. 5 LakhRs. 5,000
Upto Rs. 5 LakhRs. 1,000

* Total Income = Gross Total Income – Sec 10 exemptions – Chapter VIA deductions

Benefits of filing within the due date!

By filing the returns on time you are not only saving the late fee but also certain benefits associated with it. They are:

(i) Saves your money – Up to Rs. 5,000

  • Any person who files his income tax return on time can get away from the late fee of Rs. 5,000 imposed by the department. Unlike the other interest and penalties under income tax, the late fee under sec 234F is fixed and it will be levied once the due date is over. Hence, even if the assessee files the return on 1st August 2024 (i.e. after the due date of filing for AY 2024-25) also is liable to pay the late fee accordingly.

(ii) Get a Faster Refund

  • Filing within the due date also enables you to get a faster refund, if you have a refund of tax (i.e. TDS deducted is more than your tax liability). Also, the department will pay you interest on your refund from the beginning of the assessment year i.e. from 1st April 2024 onwards.

(iii) Carry forward your losses

  • You can carry forward losses only if you file your income tax return online. Otherwise, you will lose the benefit. Generally, most salaried individuals who have a housing loan for their self-occupied property and if the interest payable on such loan is more than Rs. 2,00,000 in the previous financial year, can set off the excess portion of such interest in the current year provided if you file your return on time.

Conclusion

So decide either to lose your hard-earned money by missing the due date or save it by filing the ITR before 31st July 2024.

Author is a Qualified CMA with an experience of more than 8 years in the industry. He is also an All India Rank holder in both Inter (AIR-26) & Final (AIR-46) examinations of ICAI. He loves to writes articles on Income Tax & GST.

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