We come across a lot of people, some are always late for everything and some are bang on time. Laziness, unawareness or busy schedule whatever the reason maybe if you are one of those defaulters who missed the last date (March 31, 2018) to file income tax returns (ITR) for the financial year 2015-16 and 2016-17, you cannot file a belated return anymore.
But, if you are reading this blog you have most probably missed the deadline and want to find whether there is still any Chance.
Things that can be done if you have missed the deadline to file ITR
You can file a Condonation of delay request for specific cases:
In specific cases, taxpayers are allowed to file returns post deadline by the income tax department. A circular is issued for the defaulters by the Central Board of Direct Taxes (CBDT) which states that in case the taxpayer has tax refund pending or wish to carry forward his losses, then he can still win a chance by filing an application to the Income tax commissioner or the prescribed authority.
Acceptance of the application by the income tax department is based on the following terms and conditions:
a) The claim has to be correct and genuine
b) The case is based on genuine hardship on merits
c) Income is not assessable in the hands of any other person under the Income Tax Act
d) The refund has arisen as result of excess tax deducted or tax collected at source, advance tax or self-assessment tax.
This application comes with a time limit of six years from the end of the assessment year for filing the return. (Assessment year is the year immediately following the financial year). It means you can file the application by 31 March 2023 (for FY 2015-16) 31 March 2024 (for FY 2016-17). Unfortunately, no interest will be paid in case of the belated tax refund. The department disposes of the application within six months duration from the end of the month in which the application is received.
If payment of taxes are also due
Even if you can no longer file the ITR post-March 31, 2018. It is suggested by the experts to pay all due taxes and interest under section 234A, 234B or 234C if, unpaid for FY 2015-16 and 2016-17.
If ITR is not filed but all taxes are paid
If your tax payments are clear but you somehow missed to file ITR before March 31, 2018, then you stand no chance to file ITR now or to apply for condonation of delay. Certainly, the department can issue a notice u/s 271F for levying of penalty on non-filing of ITR with a maximum penalty of Rs 5,000. However, if you have a genuine reason for such non-compliance then no penalty may be levied.
Actions taken by tax department against defaulters:
It is mandatory for taxpayers to file ITR if their total income surpasses the basic exemption limit. Various actions can be taken, if you have failed to timely file ITR, which includes issuing a notice or getting prosecuted upto seven years.
The department can issue a notice under section 148 for income escaping the assessment for non-filing of ITR. The defaulter will have to respond to the notice on the income tax e-filing website as well as file ITR.
Penalties under such case will be levied for under-reporting of incomes. A penalty of 100-300 percent of the tax payable amount will be levied as per the discretion of the assessing officer for FY 2015-16 and 50 percent of the tax payable amount will be charged for FY 2015-16.
In another case where if TDS has been deducted from the income and the taxpayer fails to file ITR, the department can then issue a notice under 142 (1) (i) for non-filing of returns. There are possibilities of being penalised by the assessing officer with the amount of Rs 5,000.
A wise person always finds his way out but it’s better not to put yourself in trouble in the first place, ignorance can cost you lot more than you expect. Tax2win can guide you with such complications, hope this blog has helped you in this cause.
From India, Jaipur
But, if you are reading this blog you have most probably missed the deadline and want to find whether there is still any Chance.
Things that can be done if you have missed the deadline to file ITR
You can file a Condonation of delay request for specific cases:
In specific cases, taxpayers are allowed to file returns post deadline by the income tax department. A circular is issued for the defaulters by the Central Board of Direct Taxes (CBDT) which states that in case the taxpayer has tax refund pending or wish to carry forward his losses, then he can still win a chance by filing an application to the Income tax commissioner or the prescribed authority.
Acceptance of the application by the income tax department is based on the following terms and conditions:
a) The claim has to be correct and genuine
b) The case is based on genuine hardship on merits
c) Income is not assessable in the hands of any other person under the Income Tax Act
d) The refund has arisen as result of excess tax deducted or tax collected at source, advance tax or self-assessment tax.
This application comes with a time limit of six years from the end of the assessment year for filing the return. (Assessment year is the year immediately following the financial year). It means you can file the application by 31 March 2023 (for FY 2015-16) 31 March 2024 (for FY 2016-17). Unfortunately, no interest will be paid in case of the belated tax refund. The department disposes of the application within six months duration from the end of the month in which the application is received.
If payment of taxes are also due
Even if you can no longer file the ITR post-March 31, 2018. It is suggested by the experts to pay all due taxes and interest under section 234A, 234B or 234C if, unpaid for FY 2015-16 and 2016-17.
If ITR is not filed but all taxes are paid
If your tax payments are clear but you somehow missed to file ITR before March 31, 2018, then you stand no chance to file ITR now or to apply for condonation of delay. Certainly, the department can issue a notice u/s 271F for levying of penalty on non-filing of ITR with a maximum penalty of Rs 5,000. However, if you have a genuine reason for such non-compliance then no penalty may be levied.
Actions taken by tax department against defaulters:
It is mandatory for taxpayers to file ITR if their total income surpasses the basic exemption limit. Various actions can be taken, if you have failed to timely file ITR, which includes issuing a notice or getting prosecuted upto seven years.
The department can issue a notice under section 148 for income escaping the assessment for non-filing of ITR. The defaulter will have to respond to the notice on the income tax e-filing website as well as file ITR.
Penalties under such case will be levied for under-reporting of incomes. A penalty of 100-300 percent of the tax payable amount will be levied as per the discretion of the assessing officer for FY 2015-16 and 50 percent of the tax payable amount will be charged for FY 2015-16.
In another case where if TDS has been deducted from the income and the taxpayer fails to file ITR, the department can then issue a notice under 142 (1) (i) for non-filing of returns. There are possibilities of being penalised by the assessing officer with the amount of Rs 5,000.
A wise person always finds his way out but it’s better not to put yourself in trouble in the first place, ignorance can cost you lot more than you expect. Tax2win can guide you with such complications, hope this blog has helped you in this cause.
From India, Jaipur
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Presentation on filing of Income Tax Return.ppt
Circular No 1-2018 Processing of income-tax returns under section 143(1) of the Income-tax Act .pdf
Income Tax Calculator.xls