Consequences of filling belated income tax return

 Every person who is required to file income tax return u/s 139(1) of income tax act shall file his return on or before due date. However, if person fails to file return within specified period than also he can file before end of relevant Assessment year. In such case assessee has to relinquish certain benefits and pay penalty or interest.

Due date for FY: 2019-20 : https://taxkidunniya.blogspot.com/2020/11/extend-due-date-of-income-tax-return.html



Here are some major disadvantages of non filling return within prescribe time.

1. Penalty for late filing ITR

Sec 274F of income tax act 1961, provide penalty for Non filling ITR on or before due date specified u/s 139(1). Assessee  shall be liable to pay penalty for :
  • Rs 5000, if return file on or before 31st December of relevant assessment year.
  • Rs 10,000, if return file after 31st Dec but on or before 31st march of relevant assessment year.
*However, penalty is restricted for Rs 1000 for Penson whose income does not exceed Rs 500,000.

2. Cannot carryforward Losses.

If income tax return is filed after due date specified u/s  139(1) , he can't carry forward losses under the head of :
  • Business & Profession including Speculation business.
  • Capital gain
* However, House property & Unabsorbed depreciation can carry forward even if return filed after due date. 

3. Interest Liability

As per sec 234A of income tax act if someone fails to file return within due date , he shall be liable to pay interest @1% per month or part thereof on tax payable from due date of filling return till date of actual filling. 

4. Certain deduction not available

  • Exemption u/s 10A or 10B will not be available.
  • Deduction u/s 80-IA,80-IAB,80-IAC,80-IB,80-IBA,80-IC,80-ID,80-IE,80-JJA,80-JJAA,80-LA,80P,80PA,80QQB and 80RRB will not be available.
5. Delay in income tax refund, if any.

Location: India

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