Why you shouldn’t wait for the 30 Sept deadline for filing belated returns for FY19

The 30 September deadline for filing belated or revised revenue tax returns (ITR) for evaluation 12 months 2019-20 (monetary 12 months 2018-19) is quick approaching.

Belated ITR is the one filed after the due date, which is mostly 31 July of any evaluation 12 months. For FY19, the due date of filing ITR was 31 August and the evaluation 12 months was until March 2020. Revised ITR is filed when you wish to make a change or correction in your unique ITR filed.

The final date for filing belated or revised ITR for AY20 has already been prolonged 3 times this 12 months in the wake of the covid-19-induced lockdown. It was first postponed to 30 June 2020 after which to 31 July 2020. So, it’s higher for taxpayers to file their belated or revised ITR as quickly as doable and never wait until the final minute in the hope of getting one other extension.

Here are another explanation why you ought to file your belated return at the earliest and never delay it additional. We additionally inform you what occurs if you don’t file your returns in any respect.

No reduction

(*30*) the date of filing belated ITR has been prolonged, there isn’t any reduction from the late filing penalties and curiosity on unpaid tax dues.

In case the taxpayer misses the ITR due date (which was 31 August for FY19), a flat penalty of 5,000 will likely be levied when you file belated returns until 31 December, and 10,000 if you file between 31 December and 31 March.

For small taxpayers with revenue of as much as 5 lakh, a penalty of 1,000 is relevant in case of filing belated ITR until 31 March. Even if you file the belated return for FY19 by 30 September, you must pay a late filing penalty of 10,000.

In case you had any tax dues whereas filing belated ITR, you must pay curiosity on the excellent quantity at 1% for every month of delay beginning 1 September 2019.

Also, if you are liable to pay any advance tax, you must pay curiosity on the delay or default on advance tax cost underneath the respective sections of the Income-tax Act, 1961.

“If the taxpayer has not paid advance tax for FY19 or discharged lower than 90% of their legal responsibility by advance tax, an extra curiosity at the rate of 1% per thirty days or a part of the month will likely be levied until the date the total tax legal responsibility has been paid. Tax legal responsibility is calculated on the time of filing ITR,” mentioned Kapil Rana, founder and chairman, HostBooks Ltd, an accountancy agency.

Delay in refunds

In case you have a tax refund due, the cost will likely be delayed as the tax division will begin processing the refunds solely after you file the belated return.

The tax division pays curiosity on refunds from the date of filing of return in case of late returns. So in case you delay filing the belated return, you will lose on the curiosity cost in your tax refund, if any.

If you don’t file ITR

In case you don’t file belated ITR inside the due dates, the revenue tax division can ship you a discover.

“If you have taxable revenue and don’t file ITR, you might find yourself paying penalty for concealment of revenue. In the excessive case, you might obtain a discover for prosecution,” mentioned Vivek Jalan, companion at Tax Connect Advisory Services LLP.

If the deadline is just not prolonged, it might be your final probability to file ITR for FY19 as the tax division doesn’t permit filing of return after the due date.

Also, bear in mind that there’s a prolonged course of to file belated ITR after the due date and is allowed solely in particular circumstances.

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