ITR deadline: 5 penalties taxpayers can face for late filing
What's the story
Income tax authorities have highlighted different consequences for various defaults or irregularities in tax filing. Mistakes such as delays, omissions, incorrect disclosures, or non-compliance can lead to additional financial liabilities like fees, interest, or penalties. The consequences vary from fixed charges to those based on the amount of taxes involved.
Tax benefits
Missing deadline can lead to further scrutiny from tax authorities
With the final deadline of July 31 approaching, the IT Department has urged taxpayers to file their returns early.
Filing an Income Tax Return (ITR) after the due date attracts a late fee of up to ₹5,000 under Section 234F. The penalty is capped at ₹1,000 if total income does not exceed ₹5 lakh.
Similarly, a delayed revised return under Section 234-I incurs a fine of ₹1,000 or ₹5,000 based on income level.
Penalties
Hefty fine for misreporting
Under-reporting or misreporting income carries a penalty ranging from 50% to 200% of the tax payable, under Section 270A of the Income Tax Act.
Receiving ₹2 lakh or more in cash in violation of rules under Sections 269ST and 271DA results in a penalty equal to the entire cash amount received.
Additionally, failure to pay self-assessment tax under Sections 140A and 221 can lead to a penalty up to the total outstanding tax amount.
Tax compliance
Tips to file ITR correctly
Understanding the applicable legal provisions and knowing the penalties for common defaults can help taxpayers avoid unnecessary costs. It also ensures a smoother filing experience.
To file tax returns correctly, professional guidance is recommended.
Taxpayers are advised to submit their returns well in advance of the last day to stay compliant with tax laws and avoid any potential penalties or issues later on.