Error of Omission

What to do if you have missed filing your I-T return

You want to take your family abroad for a vacation. You eagerly start collecting documents so that you can apply for visas on time. However, you realise that an important document is missing from your file -- your income tax returns (ITRs) - without which your visa application will not be processed. You are wondering what to do as last-minute changes to the plan may upset your family.

ITR is an important document, required to verify your income for purposes such as buying a house or applying for a visa. But do not get disheartened if you have not been able to file your ITR on time. You can still do that under Section 139(4)of the Income Tax Act, known as the belated return Section.

Though the process for filing belated returns is not any different, there have been a few changes in rules of late that you should know about. These include reduction in the time period for filing the previous years return and cancellation of the option to revise a belated return. Here is the lowdown on how to file ITRs of previous years.

New Rule

At present, you can file IT returns for two previous financial years. For example: up to March 31, 2018, you can file return for the previous two financial years -- 2015/16 and 2016/17.

However, the return for financial year 2016/17 can be filed or revised till March 31, 2018 only. This is because the time period for filing previous ITRs has been reduced from two to one financial year. Sudhir Kaushik, Chief Financial Officer,, says, "For last two financial years, you can file online without any condonation, that is, you can file for 2015/16 till March 31, 2018, as belated or revised return. However, from financial year 2016/17, the ITR can be filed by March 31, 2018, only, because the time period for belated and revised returns has been reduced from two years to one financial year."

Time-Barred Returns

If you file after two years, the return is treated as time barred and invalid under law. So, what can you do in this case? If you have already paid tax but not filed the return, there is no need to do so. In case you have the time to file belated returns, you must do so, but you may have to pay Rs 5,000 penalty for late filing. "One can file after receiving a notice from the income tax department. Otherwise, for previous six financial years, one needs to submit an application for condonation of delay to the commissioner of income tax (CIT) with reasons for the delay and for filing now. The reasons for filing which can be allowed by the CIT are pending refund or carry forward of losses in previous years. However, the reason for non-filing within the due date should be genuine and acceptable to the CIT as per tax laws," says Kaushik.

What if you needed to pay income tax in previous years? "In order to avoid notices from the department in future, you can calculate and pay the tax due along with the interest," says Chetan Chandak, Head of Tax Research, H&R Block India. He added once you have discharged the taxes due as mentioned earlier, you can write to the ITO requesting for condonation of the delay and permission to file the return. This may help you avoid penalties at least.

In refund cases, if you are filing after two years, the application will not get processed. "But you can still claim the refund if it is a significant amount and the return was not filed because of some genuine reasons," says Chandak. In that case, you will have to submit the application to the income tax officials concerned, depending upon the amount due.

Experts say if the refund is not significant, it is not worthwhile to start the cumbersome process, because even if your application is allowed, no interest will be paid.

Penalty for late filing

For returns up to 2016/17: You have to pay penal interest at the rate of 1 per cent till you file the return. Moreover, your losses will not be eligible for carry-forward or set-off against future profits.

For Returns from 2017/18 and onwards: There will be additional late fee of Rs 5,000 if the return is furnished after the due date but on or before December 31 of the relevant assessment year; a fee of Rs 10,000 shall be payable after December 31. However, for small taxpayers or where the total income does not exceed Rs 5 lakh, the fee amount shall not exceed Rs 1,000.

Archit Gupta, Founder & CEO ClearTax, says, "The penalties can be in the form of interest on tax due under Section 234A, 234B or 234C. Furthermore, losses cannot be carried forward in delayed returns."

Whatever happens, just make sure that you enter the correct information as you may not be able to revise the returns later. Abhishek Soni, CEO & Co-Founder at, says, "If you are a salaried person, then you must have Form 16, deductions details, etc, with you for the relevant year." Moreover, one should also make sure that one does not delay filing returns because the more the delay, the more interest you will have to pay on the tax due.