Filing Income Tax Returns: What to Do If You Missed the Deadline
We come across many people; some are always late for everything, while others are punctual. Whether due to laziness, unawareness, or a busy schedule, if you are one of those defaulters who missed the last date (March 31, 2018) to file income tax returns (ITR) for the financial years 2015-16 and 2016-17, you can no longer file a belated return. However, if you are reading this blog, you have most likely missed the deadline and want to find out if there is still any chance.
Things That Can Be Done If You Have Missed the Deadline to File ITR
You can file a Condonation of Delay request for specific cases: In certain situations, taxpayers are allowed to file returns post-deadline by the income tax department. The Central Board of Direct Taxes (CBDT) issues a circular for defaulters stating that if the taxpayer has a pending tax refund or wishes to carry forward losses, they can still have a chance by filing an application to the Income Tax Commissioner or the prescribed authority. Acceptance of the application by the income tax department is based on the following terms and conditions:
a) The claim must be correct and genuine.
b) The case is based on genuine hardship on merits.
c) Income is not assessable in the hands of any other person under the Income Tax Act.
d) The refund has arisen as a result of excess tax deducted or tax collected at source, advance tax, or self-assessment tax.
This application comes with a time limit of six years from the end of the assessment year for filing the return. (The assessment year is the year immediately following the financial year). This means you can file the application by March 31, 2023 (for FY 2015-16) and March 31, 2024 (for FY 2016-17). Unfortunately, no interest will be paid in the case of a belated tax refund. The department disposes of the application within six months from the end of the month in which the application is received.
If Payment of Taxes Is Also Due
Even if you can no longer file the ITR post-March 31, 2018, it is suggested by experts to pay all due taxes and interest under sections 234A, 234B, or 234C if unpaid for FY 2015-16 and 2016-17.
If ITR Is Not Filed but All Taxes Are Paid
If your tax payments are clear but you somehow missed filing the ITR before March 31, 2018, then you stand no chance to file ITR now or to apply for condonation of delay. Certainly, the department can issue a notice under section 271F for levying a penalty on non-filing of ITR with a maximum penalty of Rs 5,000. However, if you have a genuine reason for such non-compliance, then no penalty may be levied.
Actions Taken by the Tax Department Against Defaulters
It is mandatory for taxpayers to file ITR if their total income surpasses the basic exemption limit. Various actions can be taken if you have failed to file ITR on time, which includes issuing a notice or getting prosecuted for up to seven years. The department can issue a notice under section 148 for income escaping assessment due to non-filing of ITR. The defaulter will have to respond to the notice on the income tax e-filing website and file ITR. Penalties under such a case will be levied for under-reporting of incomes. A penalty of 100-300 percent of the tax payable amount will be levied at the discretion of the assessing officer for FY 2015-16, and 50 percent of the tax payable amount will be charged for FY 2015-16.
In another case, if TDS has been deducted from the income and the taxpayer fails to file ITR, the department can issue a notice under section 142 (1) (i) for non-filing of returns. There are possibilities of being penalized by the assessing officer with an amount of Rs 5,000. A wise person always finds a way out, but it’s better not to put yourself in trouble in the first place. Ignorance can cost you a lot more than you expect. Tax2win can guide you through such complications. I hope this blog has helped you in this cause.
We come across many people; some are always late for everything, while others are punctual. Whether due to laziness, unawareness, or a busy schedule, if you are one of those defaulters who missed the last date (March 31, 2018) to file income tax returns (ITR) for the financial years 2015-16 and 2016-17, you can no longer file a belated return. However, if you are reading this blog, you have most likely missed the deadline and want to find out if there is still any chance.
Things That Can Be Done If You Have Missed the Deadline to File ITR
You can file a Condonation of Delay request for specific cases: In certain situations, taxpayers are allowed to file returns post-deadline by the income tax department. The Central Board of Direct Taxes (CBDT) issues a circular for defaulters stating that if the taxpayer has a pending tax refund or wishes to carry forward losses, they can still have a chance by filing an application to the Income Tax Commissioner or the prescribed authority. Acceptance of the application by the income tax department is based on the following terms and conditions:
a) The claim must be correct and genuine.
b) The case is based on genuine hardship on merits.
c) Income is not assessable in the hands of any other person under the Income Tax Act.
d) The refund has arisen as a result of excess tax deducted or tax collected at source, advance tax, or self-assessment tax.
This application comes with a time limit of six years from the end of the assessment year for filing the return. (The assessment year is the year immediately following the financial year). This means you can file the application by March 31, 2023 (for FY 2015-16) and March 31, 2024 (for FY 2016-17). Unfortunately, no interest will be paid in the case of a belated tax refund. The department disposes of the application within six months from the end of the month in which the application is received.
If Payment of Taxes Is Also Due
Even if you can no longer file the ITR post-March 31, 2018, it is suggested by experts to pay all due taxes and interest under sections 234A, 234B, or 234C if unpaid for FY 2015-16 and 2016-17.
If ITR Is Not Filed but All Taxes Are Paid
If your tax payments are clear but you somehow missed filing the ITR before March 31, 2018, then you stand no chance to file ITR now or to apply for condonation of delay. Certainly, the department can issue a notice under section 271F for levying a penalty on non-filing of ITR with a maximum penalty of Rs 5,000. However, if you have a genuine reason for such non-compliance, then no penalty may be levied.
Actions Taken by the Tax Department Against Defaulters
It is mandatory for taxpayers to file ITR if their total income surpasses the basic exemption limit. Various actions can be taken if you have failed to file ITR on time, which includes issuing a notice or getting prosecuted for up to seven years. The department can issue a notice under section 148 for income escaping assessment due to non-filing of ITR. The defaulter will have to respond to the notice on the income tax e-filing website and file ITR. Penalties under such a case will be levied for under-reporting of incomes. A penalty of 100-300 percent of the tax payable amount will be levied at the discretion of the assessing officer for FY 2015-16, and 50 percent of the tax payable amount will be charged for FY 2015-16.
In another case, if TDS has been deducted from the income and the taxpayer fails to file ITR, the department can issue a notice under section 142 (1) (i) for non-filing of returns. There are possibilities of being penalized by the assessing officer with an amount of Rs 5,000. A wise person always finds a way out, but it’s better not to put yourself in trouble in the first place. Ignorance can cost you a lot more than you expect. Tax2win can guide you through such complications. I hope this blog has helped you in this cause.