The two important deadlines for filing Income Tax Returns (ITRs), July 31 and August 31, have now passed. However, this does not mean that taxpayers have no more options.
If you or your company could not file the ITR by the deadline, there is no need to panic. The Income Tax Department has set different deadlines for tax audits, transfer pricing cases, belated returns, revised returns
and updated returns. Therefore, taxpayers should know the upcoming deadlines that apply to them.
ITR Deadline for Tax Audit Cases
The August 31 ITR filing deadline does not apply to taxpayers whose income or business is required to be audited.
For such taxpayers, the tax audit report must be submitted by September 30. After that, they can file their original ITR by October 31.
Similarly, businesses involved in international transactions or certain domestic transactions covered under transfer pricing rules must submit Form 3CEB by October 31. These taxpayers can then file their ITR by November 30.
Belated ITR Can Be Filed After the Deadline
Taxpayers in the general or non-audit category who could not file their ITR by August 31 can still file a belated return. The deadline for filing a belated ITR is December 31.
However, filing an ITR late comes with some disadvantages. Under Section 234F of the Income Tax Act, taxpayers with annual total income of up to ₹5 lakh have to pay a late fee of ₹1,000. If the income is more than ₹5 lakh, the late fee increases to ₹5,000.
If there is any tax payable, the taxpayer may also have to pay interest at the rate of 1% per month under Section 234A.
Another disadvantage is that certain losses from business or capital gains may not be allowed to be carried forward for adjustment in future years when the return is filed late. Tax refunds may also be delayed.
Revised ITR Can Correct Mistakes
If a taxpayer has filed the ITR on time but later discovers that some information is missing or there is an error in the return, a revised ITR can be filed.
The last date for filing a revised ITR is March 31. If the return is revised before December 31, no additional late fee is applicable. However, a revised return filed after December 31 may attract fees according to the applicable rules.
ITR-U Can Be Used to Report Missing Income
If a taxpayer fails to file a belated ITR by December 31 or forgets to report significant income in the return, they can use an updated return, known as ITR-U.
The ITR-U facility is available for 48 months from the end of the relevant assessment year. However, filing an updated return requires the taxpayer to pay additional tax and interest.
If the ITR-U is filed within 12 months, the additional tax can be up to 25%. If filed within 24 months, it can be up to 50%. The additional tax can increase to 60% when filed within 36 months and 70% when filed within 48 months.
Therefore, if any income is missed in the original return, it can still be reported later through an updated return. However, waiting longer increases the additional tax and interest burden on the taxpayer.
