Filing Your ITR By 31 July 2022 Can Save You This Much Amount
File your income tax return (ITR) for the financial year 2021-22, or assessment year 2022-23 on or before 31 July to avoid attracting penalties like late fees.
The Financial Consequences Of Missing ITR Deadline
- File your ITR by December 21, 2022, with a late fee according to your tax slab. The late fee for income group of up to ₹ 5 lakh is ₹ 1,000 and for over ₹ 5 lakh is ₹ 5,000. But no late fee is levied for the group whose income doesn’t exceed the basic exemption limit.
- Missing a deadline will attract interest on the late payment of taxes. You will pay some tax with interest and dividends. TDS deduction is made at 10%, but if you are in the 20% or 30% tax slab, the differential amount will attract the interest of 1% per month according to Section 234A.
- The interest rate charged will be applied retrospectively from the last date of filing ITR, July 31, 2022. Also, if the outstanding dues are paid after the 5th of any month, you will be charged an interest rate for the full month.
- Carrying forward losses isn’t allowed after the due date. If you are forced to sell property/shares/capital in losses during the pandemic time, the losses should be declared and filed on or before the due date.
- Income Tax Department could send a notice for not filing or mismatch of income/loss declared.
- You can apply for refunds and losses till 31 December 2022 and if you miss this deadline, you will be required to find an appeal for condonation for refund and losses carried forward.
- The commissioner of income tax of your ward will consider your application and approve it only if he finds a bonafide reason for the delay in filing your ITR.
- A huge penalty will be levied for undeclared additional income in AIS or other documents. The undeclared wealth will attract 50% additional tax if filed updated return within a year and 100% additional if ITR is filed after one year but before two years.
- Post the 31 December 2022 deadline, you will be required to use a new ITR U form to file an updated return and give reasons for updating your income reasons.
- The reasons given are return previously not filed; income not reported correctly; wrong heads of income chosen; reduction of carried forward loss; reduction of unabsorbed depreciation; reduction of tax credit u/s 115JB/115JC; wrong rate of tax and others.