JOIN USBelated and revised income tax returns
The due date for filing Income Tax Returns (ITR) for the financial year ending March 2021, in the case of individual taxpayers was December 31, 2021. Did you miss this deadline? As per Section 139(4), any person who has not furnished a return within the time allowed may furnish a belated return and for FY 20-21, such returns can be filed before March 31, 2022.
The late filers, who are filing returns between January 1 and March 31, 2022, have to pay a penalty for the delay! Those who have a total income of over Rs 5 lakhs, have to pay a penalty of Rs 5,000, and those with less than Rs 5 lakhs income, pay Rs 1000. However, someone who has an income of, say, Rs 2 lakhs, which is less than the tax exemption limit, but wants to claim a TDS refund, can file the return, without paying any penalty.
Should a taxpayer who has to get a refund from the tax department, but missed filing the return by December 31, pay a penalty if he wants to file the return now? Yes. For example, if his total income is more than Rs 5 lakhs, even if there is a refund to claim, he has to pay a penalty of Rs 5000.
What if one fails to file the return before March 2022? If this deadline also is missed, then one can’t file ITR voluntarily. In such cases, the ITR can only be filed in response to a notice from the tax department. So, make sure to file your return before the end of this financial year.
A belated return, however, won’t carry all the benefits of timely filed returns! Radhakrishna has over Rs 30 lakhs as losses from F&O (Futures and Options) trading. Koushik has a loss of Rs 10 lakhs from the sale of a flat. Any of these losses, which otherwise are available for carrying forward to set off in the future, can’t be carried forward if the returns are not filed within the original or extended due dates. A belated return will only give the benefit of carry forward for losses from house property and nothing else.
Revised Returns
After filing the return, if a taxpayer finds errors or has omitted to report certain income or claim some expenses, he can revise the return, without paying any penalty. As per Section 139(5), even a Belated ITR can be revised. Those who have filed the returns, may check the Annual Information Statement (AIS) once and see whether anything has been missed in reporting and if so, they still have the chance of revising the return.
Condonation of delay
The tax department gives enough opportunities for the taxpayers to file the return, claim the refund. Suppose, a taxpayer realises after a year, say in 2023, that he missed filing the returns for AY 2021, does he have any option to file the return? He can request the Commissioner of Income Tax through a Letter for Condonation of Delay and if the officer finds that the reasons for the delay or non-filing of returns are justified, he may accept such request and grant the option of filing the returns.
E-Verification of returns
Lastly, please be aware that the ITR is considered as a valid return only if e-verification is carried out within 120 days from the date of filing the return. If the return is not verified, then the tax return will not be treated as a valid return by the department. Thereby, your ITR will not be taken up for processing and all the penal provisions of non-filing of the returns can be triggered by the department.
(The writer is a chartered accountant based in Bengaluru)
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