You need to File your Income Tax Return (ITR) Quicker - Here is why

Income Tax Return due date missed? Its Ok.

You can still file your return of Income, aka Belated Income Tax Return.

And you need to file your belated return at any cost, by 31st December (9 months from the end of financial year).

(1) Is it true that the Government has reduced the penalty on belated returns?

- NO! It is a hoax

Although the lawmakers have amended the penalty provisions, to make sure that the maximum penalty is also reduced (from Rs 10,000 to Rs 5,000) side by side the maximum time allowed for filing your return of Income (from 31st March to 31st December, 3 months), in reality, It is a hoax.

Here is the thing, earlier the government collected the penalty in two tiers. For the "belated returns" that are filed within 31st December, the penalty was Rs 5,000 and for those filed within 31st March, the penalty was Rs 10,000.

Point is, you could file your return by 31st March after paying a penalty of Rs 10,000.

So, technically they have just eliminated the "3 months" and the "extra penalty of Rs 5,000" provisions, they have shifted the pressure on you for filing your return of income quicker.

Now, you can not file your belated return after 31st December, even after paying double penalty to file your return of income.

(2) Result of not being able to file your return of Income?

Amonng many things, you may not be able to claim depreciation, carry forward losses or claim a refund of income tax.

(3) New Maximum Penalty of Rs 5,000 Not applicable for:

1. Persons, who need not audit their accounts and
2. Persons, whose total income is less than Rs 5 lakhs (maximum penalty will be Rs 1,000)

So, to summarize, you need to file your return of income quicker.

If you want to know the due date, by which, you should file your Income Tax Return, use this link.