What if you miss IT return filing deadline of September 7?
September, 09th 2015
In a rare occurrence, the income tax department, for the benefit of taxpayers, extended the timeline twice so returns can be filed within the ‘due date’ for financial year 2014-15 (assessment year 2015-2016).
Those with total income (before deductions) in excess of Rs 2,50,000 have to mandatorily file their returns, whether or not they have tax due. Those seeking a refund or those who hold foreign assets or have earned a foreign income or have bank accounts or financial interest outside of India must also file their tax returns.
While you may be a diligent tax payer, what if you have skipped the due date and could not file your return timely. Let’s understand the ramifications of not filing your return within the due date.
•Capital losses cannot be carried forward – Capital losses are allowed to be adjusted against your capital gains income. While long term losses can only be set off only against long term gains, short term losses can be set off against both long term and short term capital gains. If you have not been able to set off your entire capital loss in the same year, both short term and long term loss can be carried forward for eight assessment years following the year in which the loss was first incurred. A lot of taxpayers deal in the stock market and incur short term losses. If you have not filed your return by 7th September, unfortunately, you may no longer be able to carry these losses forward and adjust them. (Do note that long term losses on shares and equity funds are a dead loss and cannot be set off or carried forward).
•Be careful about filing your return correctly – It goes without saying that your returns must be filed correctly and accurately. However, returns which are filed after the due date cannot be revised. So if you have missed the due date of 7th September, do make sure you file your return with extra caution and take help from an expert if required.
•Those who have a tax due in their return – If you have tax payable for income earned in the financial year 2014-15, besides having to pay interest under section 234B and 234C, you’ll also have to pay interest under section 234A. Section 234A is applicable for default in filing your return timely. It is calculated on the tax which is unpaid and is calculated starting from the due date. Days are rounded off to a month and interest @ 1% is payable. Though if there’s no tax due in your return, no interest under section 234A is charged for returns filed after due date.
•Those seeking a refund – A lot of taxpayers who have a refund due in their returns and filed timely have received refunds within 2 weeks of filing. The tax department has been very efficient with processing them. So if you have a refund in your return do not delay any more and file your returns soonest.
•Penalty on returns filed after the end of assessment year – While you may have missed the due date and have no tax payable, do make sure you submit your return before 31st March 2016. The Assessing Officer can levy a penalty under section 271F of Rs 5,000 if you do not submit your return by this date.