Missed tax filing deadline? Here is what you need to do
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Missed tax filing deadline? Here is what you need to do

July 31 is usually the last date for filing income tax returns (ITR), but this year, it was extended to August 5 to give more time to tax filers.

 Renu Yadav   
  • New Delhi,  August 8, 2017  
  • |  
  • UPDATED   14:42 IST
Missed tax filing deadline? Here is what you need to do

July 31 is usually the last date for filing income tax returns (ITR), but this year, it was extended to August 5 to give more time to tax filers.

Despite the extension, many must have failed to file their tax returns on time. Any person whose income for the financial year (FY) 2016/17 is more than the exempted limit is supposed to file tax returns.

If you belong to this category and could not file your ITR on time, do not get disheartened as you can file late returns. "If you miss the due date to file ITR on time, you can still file returns u/s 139(4), commonly known as a belated return," says Chetan Chandak, Head of Tax research at H&R Block India.

The process of filing belated returns is not different from the normal procedure, but here are a few pros and cons to keep you updated.

Deadline for filing belated ITR

You can file belated ITR on any date until the end of the assessment year (AY). So, for FY2016/17, you can file belated ITR until March 31, 2018. You can also revise belated returns. "Earlier, a taxpayer was not allowed to revise belated returns, but from AY 2016/17, taxpayers are allowed to do so," says Chandak.

Late filing: What you lose

Filing belated ITR has certain disadvantages as listed below.

Loss of interest on refund

If you had a tax refund to claim for paying excess tax, you are eligible for a refund as well as interest (0.5 per cent per month or 6 per cent per annum) from the beginning of the assessment year. But in case you file a belated ITR, the interest will be calculated only from the date of filing. "The interest on refunds for returns filed, say by July 31, 2017, is calculated from April 1, 2017. But if you file returns on August 31, 2017, the interest on refund will be calculated from that date, and you will lose the interest between April 1 and August 31, 2017," says Sudhir Kaushik, Chief Financial Officer, Taxspanner.com.

No carrying forward losses

The income tax law allows you to carry forward losses on the sale of capital assets, both long term and short term, in case it is not possible to set off for the next eight assessment years. If you file a belated ITR, you will not be allowed to carry forward the losses (other than the loss from house property).

Interest on tax due

In case there is tax due after considering the advance tax paid by you and the tax deducted at source, you will have to pay interest at the rate of 1 per cent per month or 12 per cent per annum, on the interest amount due if you fail to file returns on time.

More penalties

You may be charged a penalty of Rs 5,000 in case ITR is delayed, but it is at the discretion of the assessing officer. However, from next year onwards (FY2017/18), there will be a fixed penalty of Rs 5,000 in case a person fails to file ITR by due date but files it before December 31. In case it is delayed beyond that, the tax penalty will be Rs 10,000. In the case of small taxpayers whose income does not exceed Rs 5 lakh a year, the penalty will be limited to Rs 1,000.