Income Tax Return: There is a penalty for late filing of ITR, but this penalty is not applicable on everyone, know what are the rules

Income Tax Return: The last date for filing Income Tax Return (ITR) for the financial year 2021-22 or AY 2022-23 is July 31, 2022. If you are not able to file ITR by the deadline, then you will have to pay penalty while filing ITR late. 

However, there are some people who can file their ITR without paying the penalty even after the deadline for ITR filing is over. Let us know who are those people who can file ITR without paying the penalty.

As per the laws related to income tax, not everyone is required to pay late fee for filing ITR after the deadline is over. If a person whose gross total income does not exceed the basic exemption limit, then he will not have to pay penalty while filing ITR late. If the gross total income does not exceed the basic exemption limit, then no late fee is levied on ITR under section 234F.

what the law says

As per the current tax laws, the basic tax exemption limit applicable to an individual depends on the tax regime opted by him/her. If a person opts for the new tax regime, his basic exemption limit will be Rs 2.5 lakh, irrespective of age. However, if a person opts for the old tax regime, the basic exemption limit depends on the age of the individual. At present, the basic exemption limit for resident individual below 60 years of age is Rs 2.5 lakh. For senior citizens 60 years and above but below 80 years of age, income up to Rs 3 lakh is exempt from tax. The basic exemption limit for super senior citizens (above 80 years of age) is up to Rs 5 lakh.

Exceptions to the above rule

However, there are two exceptions to the rule mentioned above. The first exception to the rule requires filing of ITR for certain sections even if their gross total income does not exceed the basic exemption limit. If a person fulfills any of the conditions given in the seventh provision of section 139(1), then he will have to mandatorily file ITR for the financial year 2021-22. Failure to do so will attract charges under section 234F.

Persons covered under the seventh provision of section 139(1) –

  • Persons who have deposited an amount or aggregate amount exceeding one crore rupees in one or more current accounts maintained with any banking company or co-operative bank, or
  • who has spent for himself or any other person an amount or aggregate amount exceeding rupees two lakhs for travel to a foreign country, or
  • Those who have spent an amount or total amount exceeding one lakh rupees for the consumption of electricity.

If you want to file ITR due to any of the above conditions, make sure you file your tax return before the deadline. Otherwise, you will have to pay a late fee, even if your gross total income is less than the taxable limit.