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FY2019-20 ITR deadline extended, but should you wait till the last date?
November, 23rd 2020

The last date to file the ITR for FY2019-20 has been extended multiple times, and as of now, it’s on 31st December 2020

FY2020-21 has been a challenging year in terms of widespread health perils and increased financial instabilities. Many people have lost their jobs and incomes. But despite all kinds of adversities, can you afford to delay or miss filing your income tax returns for FY2019-20? The answer is no. It’s not financially favourable for you to delay filing the ITR. The last date to file the ITR for FY2019-20 has been extended multiple times, and as of now, it’s on 31st December 2020. But you should not wait till the last date to file your tax returns. Let’s discuss a few side-effects of taking your ITR filing down to the wire.  

Delay in TDS refund

If you file the ITR well before the deadline, it’ll help in the quick processing of your TDS refund, if any. If there is a delay in refunding your TDS amount, the income tax department pays you interest on your TDS amount. However, if you file the ITR after the last date (without penalty), you are not entitled to any interest in the TDS refund by the I.T. department. So, by punctually filing the ITR, you can quickly get the TDS refund, and if there is any delay, you get the interest on your eligible TDS refund amount. Therefore, don’t wait till 31st December 2020, to file your ITR if you want to claim TDS refund.

Chances of last-minute errors

Waiting till the last minute to file the ITR can make you susceptible to errors. A mistake in filing the ITR can put you at risk of queries or investigation from the I.T. Department. The best practice is to keep all your I.T. related details ready, review the details minutely and file the returns well before the last date to file the ITR without penalty. Correct filing of ITR will help you get the TDS refund (if any) on time, and you won’t have to file a corrected or revised ITR later on.

Late interest payment

If your tax liability is expected to cross Rs. 1 lakh for the FY2019-20 period, you must avoid a delay in filing the ITR because it may cost you payment of penal interest at 1% every month. You may not want to pay anything extra in this difficult financial period because of an avoidable delay. So, if you want to avoid paying the late interest payment, file the ITR without waiting for the last date.

Filing ITR early can help in tax planning for the current FY

Filing the ITR much before the last date can help you shift your focus on tax planning for the current financial year. Only a few months are now remaining before the current FY ends. By filling the ITR for FY2019-20 on time, you may identify areas where you can save more taxes or plan your ITR for the current FY in a better way.

More time to revise the ITR, if required

The earlier you file the ITR, the more time you get to revise it if there’s some mistake. Usually, taxpayers get time till the end of the assessment year to revise their returns. This year, the last date to file a return (without penalty) has been extended multiple times, and there are expectations that the last date to file the ITR (with penalty) will be extended too, but you must not rely on it.

Remember, you will have to file the ITR for FY2020-21 too after it ends. So, you must avoid a financial hotchpotch by correctly filing the ITR for FY2019-20 well before the last date.

FY 2020-21 has been a difficult year for many people from the income point of view, and you may not want to complicate things further by delaying your ITR. So, try to file your ITR well before the deadline so that you can focus on other pressing matters. 

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