The due date for filing your income tax return for the assessment year 2023 was July 31. The government has not given any extension to the ITR filing deadline, as has been confirmed today.
According to the Income Tax department, more than 63.47 lakh income tax returns were filed until 10 pm on Sunday, July 31, 2022, which was the ITR filing deadline.
So, what happens if you have missed filing your returns by July 31? Well, you can file a belated tax return, but you will have to pay a penalty for that.
Says Deepak Jain, chief executive, TaxManager.in, a tax e-filing and compliance management portal: “If due to any reason you have missed the deadline for filing your ITR for AY23, then you can still file it with a late penalty fee. This return is called a belated return and can be filed prior to three months' end of the relevant assessment year.”
Put simply, a belated income tax return is one that is filed after the due date, i.e., the ITR filing deadline. For FY 2022, any return filed after July 31, 2022, will be a belated return, as defined under Section 139 (4) of the I-T Act, 1961.
That said, there is a due date for filing a belated return, too.
According to the announcement made in Budget 2021, the time limit for filing belated return has been reduced by three months. Previously, a taxpayer could file a belated return within eight months of the assessment year after the due date of filing the return, but now it has been reduced to five months of the relevant assessment year.
Till financial year 2019-20 (AY 2020-21), one could file a belated return till March 31 of the assessment year. So, under the previous scheme of things, one could file the belated return for this year (FY 2021-22) till March 31, 2023. But now, because of the amendments announced in Budget 2021, the belated return can be filed only till December 31, 2022.
According to the changed rules under Section 234F of the I-T Act, 1961, the penalty for late filing of income tax return is Rs 5,000. However, for small taxpayers, whose income is less than Rs 5 lakh, the penalty is Rs 1,000.
Besides, you will also have to pay interest at the rate of one per cent for every month or part of a month on the amount of tax remaining unpaid under Section 234A of the I-T Act, 1961.
But do note that one cannot file an income tax return if one hasn’t paid any taxes. Also, the penalty is calculated from the date immediately after the due date.
There are certain benefits you stand to lose if you file a belated income tax return. If you have incurred any losses during the year, say a loss under the head capital gains or any loss in your business, always ensure that you file your return within the due date. Not doing so will deprive you of carrying forward these losses to the next years for setoff against future income.
In effect, you cannot carry forward any losses received under these head if you file a belated return. These are:
In case you are entitled to receiving a refund from the government for excess taxes paid, you must file your return within the due date to receive the refund at the earliest.
According to Jain, the process of filing the ITR after missing the deadline is the same, but one must keep in mind to select the relevant form and the correct assessment year.
