Help! I Missed Filing My Tax Returns!

While one can file an updated return, there are certain caveats, warns rediffGURU Mihir Tanna.

Mihir Tanna is associate director (direct tax) at SK Patodia and Associates, a chartered accountancy firm that offers tax related services. He has more than 10 years of experience in direct taxation, including filing income tax returns.

He regularly represents clients before the income tax authorities including the commissioner of income tax (appeal).

You can ask him your questions HERE.

Asit: I missed filing my Individual professional ITR by 31st December 2022 for assessment year 22-23. What should I do now?

You can file an updated return -- u/s 139(8A) of Income Tax Act.

However, you cannot claim refund/claim loss in the updated return.

In case of tax liability, you have to pay 25 per cent additional tax and file the updated return on or before 31.03.2024.

Anonymous: I and my wife co own a flat from 1994 in Mumbai. Now we want to sell it and reinvest in a residential house. Do we have to pay income tax on the amount we receive and how much will it be?

 Section 54 provides that in case a person transfers house property and invests the gained amount in acquiring new property, capital gain will be exempt.

The person must buy the residential house property one year before or two years from date of such transfer of property or construct the house property within three years from date of transfer of the property.

Tridib: My new company offering CTC is 20 lakhs. I want to what salary breakup would reduce my income tax as per old regime. I have home loan also.

The structure of the salary depends on the job profile and the company’s policy.

House rent allowance, reimbursement of car and driver expenses incurred for official purposes, research allowance for courses carried out related to the job profile, uniform allowance for expenses incurred to maintain attire, etc, are certain allowances which is usually included in the salary.

Shakir: Hi sir hope all’s well with you. Sir if i give a monthly rent of 60,000 Rs that comes to 7,20,000 Rs yearly to my paternal grandmother of 75 years who owns a 2bhk flat in south mumbai. She has no other source of income and if she files her IT return under new tax regime in financial year 2023 - 2024. Will she hav to pay any tax?

Against rent income, standard deduction of 30 per cent of income is available.

Tax rebate up to Rs 22,500 is available for FY 2023-24 for person earning income up to Rs 7 lacs.

Accordingly, no tax liability is likely to arise.

Anonymous: Hi - If I close my home loan before 5 years of taking possession and buy a new flat on loan, can I continue the tax benefit of Section 24(b) or will I have to forego and repay the tax benefit availed for my earlier loan?

Interest paid before completion of construction/purchase will be allowed as deduction in five equal instalments from the year in which property is purchased/constructed.

In your case, as the property is transferred before getting possession, it is advisable not to claim deduction.

You can ask Mihir Tanna your questions HERE.

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