IT Department Alert! Penalties Rs 5000/- you pay on missing ITR filing deadline this year

IT Department Alert! Penalties Rs 5000/- you pay on missing ITR filing deadline this year

NEW DELHI: Paying tax on income every year is the legal duty of every taxpayer. If a taxpayer fails to file income tax returns (ITR) within the mandated deadline of an assessment year, there is penalty to be paid.

These are the various penalties one has to pay on missing the ITR filing deadline:

Penalty on late filing

For the financial year 2020-21, the Central Board of Direct Taxes (CBDT) has extended the due date of filing ITR to 31 December of this year. Filing ITR after this date will attract a penalty of ₹5,000.

Maximum penalty on late filing was ₹10,000 until last year, which has been reduced to a maximum Rs5,000 beginning this assessment year. Until last year, filing belated ITR between 1 August and 31 December attracted penalty of ₹5,000, whereas returns filed after 31 December but before 31 March attracted higher penalty of ₹10,000.

Beginning current assessment year, the maximum late filing penalty has been capped at ₹5,000.

If your taxable income falls below the exemption limit of ₹5 lakh, you will be liable to pay ₹1,000 in late fee.

Interest penalty on outstanding tax

Under section 234A of IT Act, a taxpayer with an outstanding tax liability above ₹1 lakh is slapped with a monthly interest penalty of 1% on the outstanding tax amount until she files her belated ITR. This amount is calculated after reducing advance tax, TDS and relief claimed under section 89 to 90Aetc already paid.

Even though the date of filing ITR for last fiscal has been extended to 31 December 2021, this interest penalty will be levied on defaulters from the original due date of 31 July. This means that filing ITR between 1 September and 31 December will not attract late filing fee of ₹5,000 but you will have to cough up interest on the pending tax liability.

The government has excused small taxpayers with tax liability below ₹1 lakh from this penalty.

Source:-businessleague

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