Vijay, an executive working in one of the multinational companies, woke up to the fact that he has not filed his tax return and has missed the deadline of July 31, 2007. The ghost of penal interest and other penalties started hovering his mind.
He went to his chartered accountant to look for a solution and was amazed to know that there is no penal interest or any other penalty for missing the deadline as he had paid all his taxes before March 31, 2008.
Like Vijay, you being a salaried person may have missed the return filing deadline. If you have an income on which all the taxes have been deducted or have been deposited by way of advance tax, dont panic. There should be no additional penalty or interest for not filing the return by July 31, 2007, provided you act now.
You still have the time to file your return of income for the tax year 2007-08, till March 31, 2009. However, the persons who have any loss under any head of income to be carried forward may have a cause to worry as the said loss would not be allowed to be carried forward to next year if the return of income is not filed before the due date.
In case there is a shortfall in deposition of taxes, then you would be liable to pay a simple interest of 1 per cent per month on the amount of taxes short deposited from the due date of filing of tax return till the date return is actually filed. This is a penal interest for delay in filing of return of income. This interest is in addition to the interest of 1 per cent payable for shortfall in payment of advance tax.