If you have not filed Income Tax Return, then do it soon. Its last date is July 31, 2022. Many people are waiting for the Income Tax Department to extend the deadline. So far this has not been indicated by the department. If the Income Tax Department does not extend the deadline, then you may suffer a loss.
If you do not file income tax return by 31st July this year, then you can do so by 31st December this year. For this, you will have to pay interest on penalty and tax. This is called a belated return. Tax experts say that taxpayers should avoid filing belated returns.
For filing the billed return, you will have to pay a penalty of Rs 5000. If the annual income is less than Rs 500000 then the penalty will be Rs 1000. This late fee is levied under section 324F of the Income Tax Act, 1961. You have to pay this late fee before filing the belated return.
One of the disadvantages of filing a belated return is that you will not be able to carry forward certain types of losses. This includes income from other sources, income from capital gains, income from business and profession.
Second, if your income tax refund is made, this money will hang. The refund money will be credited to your account only after you have filed and verified your belated return. Interest is available at the rate of 0.50 per cent every month on the income tax refund amount. There is no interest on your refund amount if you file a belated return.
Apart from the penalty of Rs 5000, you will also have to pay interest on the tax amount. This will be 1% of the tax amount per month. In this way, the disadvantages of filing belated returns are more, the advantages are less.
It is also important to know that if you have not filed the belated return by December 31 this year, then you cannot file the income tax return until the tax department sends you a notice.
Income Tax Department has tweeted from its Twitter handle. It said that till July 28, 4.09 crore income tax returns have been filed. More than 36 lakh returns were filed only on July 28. The Income Tax Department is also sending reminders for return filing to taxpayers through SMS and email.