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Income Tax Return( ITR) Filing Due dates.Penalty & Interest for late filing

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Here is the Income tax return filing  due date for Assessment year 2019-2020,This is applicable to Financial Year 2018-19.

Income tax filing due date
Date Particulars
31st July Annual return of income for the assessment year 2019-20 if the assessee is not required to submit return of income on September 30th,
2019 or November 30th, 2019.
30th September Annual return of income for the assessment year 2019-20 if the assessee is (a) corporateassessee or (b) non-corporate assessee or (c) a
trust, whose books of accounts are required to be audited or (d) working partner (of a firm whose accounts are required to be audited).
30th November Annual return of income tax for the assessment year 2019-20 in the case of an assessee if he is required to submit a report under section
92E pertaining to international transaction(s).

 

Income tax return filing is mandatory for the following cases.

  1. Being an individual if the income exceeds the basic exemption limit,before claiming deduction under chapter VIA of income tax act  ( Which is called as gross income ) in or for a financial year,then you are required to file Income Tax Return.The rule applies to non Residents also,for their income which accrues or arises in India ( ITR Form for non-resident is ITR-2).Filing Income tax return is mandatory irrespective of the fact whether tax has been deducted/collected at source or not, so long as the income is above taxable limits.

 

The basic exemption limit varies in case of  various individuals depending upon the age of person filing income tax return. Currently i.e. for Assessment year 2019-2020  relevant to Financial year 2018-2019 , Basic exemption limits are as follows.

Particulars of Individuals Amount In rupees
For Individuals of age below 60 years. 250000
Senior Citizens of  age 60 years or more but below 80 years 300000
Senior Citizens of  age 80 years or more 500000
  1.  If any one wants to claim refund.
  2. If anyone wishes to carry forward any loss /es under any head of income to the next year.
  3. If anyone has an Asset or Financial Interest in an entity located outside India .This point is applicable only Individuals resident in India.
  4. If anyone is a signing authority for Foreign bank account. This point is applicable only to Individuals resident in India.
  5. Every partnership firm,Limited liability of partnership and Company.
  6. Every trust (charitable /religious /political /research association etc.) which derives income from the activities /property held by trust and the income of it exceeds the basic exemption limit, before claiming exemption under S.11 and S.12 of the Income tax act.
  7. Every political party ,Income of which exceeds basic exemption limit,before claiming exemption Under section 13A of the income tax act.
  8. Every research association,news agency,association or institution,fund,university,other educational institution,any hospital or other medical institution,trade union or body or authority or Board or trust or commission,infrastructure debt fund,Mutual fund or securitisation trust or venture capital company or venture capital fund etc. income of which exceeds the basic exemption limit, before claiming exemption under section 10 of The Income Tax Act.

Who are mandatory required to e-file Income tax return?

The e-filing of Income tax is compulsory for the following categories of assessees.

  • If the gross total income of the person exceeds 5 lakhs  ( Rs 500000 )
  • A person who wishes to claim refund from the department.
  • Books of account are required to be audited under section 44AB of the Income Tax Act.

Benefits of filing ITR whose Income does not exceeds basic exemption limit( Individuals & HUF)

If your basic exemption limit doesn’t exceeds Rs 250000/- during the year,then you are not legally bound to file your Income tax return.However the income tax Act does not prevent or restrict you from filing your Income tax return. It is advisable that even if you are not legally bound to file your Income Tax Return,you should file it,as filed Income tax return may be of use following situations.

  • Accidental claims: In the cases Involving accidental claim against Insurance companies,the court may apply simple formula to arrive at claim amount by multiplying the yearly Income in ITR with years of expected life of deceased.
  • Proof of Income/Proof of net worth: The best authentic document in support of claim of income level is the income tax return of the person.
  • Eligibility in loan application:Income tax returns of last three years are one of the basic documents required for loans.
  • Obtaining Visa: Foreign embassies /consulate of many countries ask you to furnish last three year’s Income tax return while applying for visa.
  • For startup funding:If you are looking to raise funds,keep in mind that many investors study income tax returns to adjudge the business stability,profitability and other cost parameters in the business.
  • Protection against suspicious black money:Income tax return of every year substantiates the income which will not be at risk of being termed as black money,as any income not reported to Income tax department comes under the suspicion of black money.
  • Buying Insurance policy with high life cover: Some insurance companies always ask for Income tax return while providing high life cover to verify your annual income.
  • Obtaining government tender :Very often ,when government tender of high value is being awarded,furnishing income tax return is a must to apply for it to justify the business credentials of a bidder especially.
  • Credit card application: If anyone wants have a high limit Credit card then your Income tax return may help to get it.

What are the consequences of Not filing  Income tax Return Within the prescribed Time?

  • One cannot carry forward any of the losses incurred during the year to next year.
  • Fee for late filing of Income tax return for AY 2018-19 was

    • From AY -2018-19 ,A fee of Rs 5000/- will be charged if an ITR is filed after the due date and up to 31 December of the assessment year.
    • Rs 10000/- If it is filed between 1 st January to 31 March of such Assessment year.
    • This amount of late fee is required to be paid before filing the Income tax reurn.
    • If the total income of the person doesn’t exceed Rs 5 Lakhs,the maximum late fee is Rs 1000/-.
  • Interest for late filing /non-filing of Income Tax Return

In case a person fails to file the return in time or fails to file return at all, then he is liable to pay interest as per provision of section 234A of Income tax act @ 1% per month on the shortfall in tax payable.

Time limit for Filing belated Tax return

An income tax return filed after the due date stipulated u/s. 139(1) of the Income tax Act but filed before 31st march of the relevant assessment year.For example,the belated ITR for AY 2018-19 needs to be filed before 31st March 2019.

Besides penalties and disadvantages that when your return is not filed by the due date, the income tax department may send you a notice of inquiry to ask you to file the return online as per the date specified in the notice.

Best Judgement assessment ( Assessment under section 144)

The Income tax department may Make a best judgement assessment in the following cases.

  1. If the tax payer fails to file the return required,and
  2. If the tax payer fails to comply with the terms of a notice issued under section 142(1).
  • Reopening cases

If you are required to file ITR and you don’t file it at all,Income tax department may send you a notice  u/s.148 of the Act up to 6 years from the end the relevant assessment year to reopen your case for taxing your income for that assessment year which has escaped assessment.

  • Penalty

If you have taxable income and do not file the return of Income,you may end up paying penalty under-reporting or misreporting of Income.The penalty leviable may go up to 200% of the tax on the under reported /misreported income.

  • Prosecution for failure to Furnish Return of Income

In case you fail to furnish the return of income,you may receive notice of prosecution under section 276CC from your assessing officer.Section 276 CC provides for rigorous imprisonment for a term upto 7 Years and fine.

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