The penalty for ITRs furnished on or before December 31 is Rs 5,000, but double that amount for later filings. Moreover, there is the interest charged under Section 234A that builds up the longer you delay filing your tax returns

The last date for filing your tax returns for assessment year 2019-20 is Saturday, so procrastinators are now beginning to run out of time. Delaying tax filing can prove costly. The penalty for ITRs furnished on or before December 31 is Rs 5,000, but double that amount for later filings.

According to Cleartax, there is a relief given to small taxpayers - the Income Tax Department has stated that if the total income does not exceed Rs 5 lakh, the maximum penalty levied for delay will be Rs 1,000. Keep in mind that the income tax exemption limit for senior citizens in the 60-80 years age bracket is Rs 3 lakh, while that for super senior citizens aged over 80 years is Rs 5 lakh.

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However, the taxman has no intentions of letting the big tax evaders off easy. If the tax evaded "exceeds Rs 25 lakh, the punishment could be 6 months to 7 years," the Income Tax Department says on its website.

"Apart from penalty for late filing, interest under Section 234A at 1 per cent per month or part thereof will be charged till the date of payment of taxes," says Cleartax, adding that the interest computation will start from the day after the deadline, or September 1. So the longer you delay filing, the more you have to shell out as interest penalty.

If you miss the deadline, you can still file belated returns till the end of the assessment year. "For example, the belated ITR of FY2018-19 can be filed until March 31, 2020. If you miss that deadline, you will never be able to file the tax return," says says Kuldip Kumar, Partner and Leader, Personal Tax, PwC India.

However, filing ITR on time is in your interest, not only to avoid the above mentioned penalties but also to ensure timely refunds. Moreover, if you file the your return within the due date, you will be able to carry forward losses to subsequent years. This can be used to set off against income in the coming years. Apart from house property loss, other losses incurred are not allowed to be carried forward to subsequent years.

Even if you do not fall in the tax net, you must consider filing a 'Nil Return' to maintain a record. There are several instances where income tax serves as a proof, including applying for a passport and taking a loan. Moreover, regularly filing your ITR validates your creditworthiness and makes it possible for you to access financial benefits such as loans, credit cards and the like.

Edited by Sushmita Agarwal