Missed Tax Return Deadline? What To Do

Submitting a late return helps you stay compliant with tax regulations and avoid legal issues.

Income-Tax Returns (ITRs) for the assessment year 2024-2025 had to be filed by July 31, 2024. If you missed the deadline, the Income-Tax (I-T) Act allows you to file a belated ITR.

"If, for any reason, you missed filing your ITR by the due date, you may still file a belated ITR up to three months before the end of the assessment year or before the end of the assessment, whichever is earlier," says S R Patnaik, partner (head-taxation), Cyril Amarchand Mangaldas.

A belated ITR for FY24 may be filed by December 31.

Stay compliant

Submitting a belated ITR helps you stay compliant with tax regulations and avoid legal issues. It can also help you avoid heavy penalties and notices from the tax department.

"Despite some additional penalties and interest, it provides taxpayers an opportunity to regularise their non-compliance. They still retain the right to claim a refund if they are eligible according to their computation and ITR, even if they did not file by the actual due date," says Ritika Nayyar, partner, Singhania & Co.

Filing a belated ITR can reduce interest accumulated under Section 234A for non-filing. The sooner you file, the lower the interest you have to pay.

File under the new tax regime

Filing a belated ITR has its disadvantages. "A late filing fee will apply, along with interest liability. The likelihood of tax scrutiny by the income-tax authorities also increases," says Suresh Surana, a Mumbai-based chartered accountant.

Taxpayers filing a belated ITR incur a fee of Rs 5,000. This fee reduces to Rs 1,000 if the total income is up to Rs 5 lakh.

Additionally, the taxpayer must pay simple interest at the rate of 1 per cent monthly on the amount of tax payable from the due date until the date of filing the belated return.

"A person filing a belated return shall also not have the option to opt for the old tax regime and hence may not be able to claim certain deductions," says Patnaik.

Belated ITR filing also restricts the ability to carry forward certain losses, such as business or capital losses.

"However, losses under the head 'income from house property' can still be carried forward if you file before the end of the assessment year," says Devansh Jain, principal associate, PSL Advocates & Solicitors.

You can claim a refund if you are eligible for one. "But these refunds might be processed later compared to the ones for returns filed within the due date," says Sandeep Bajaj, a Supreme Court lawyer.

File promptly, ensure accuracy

File a belated return promptly and avoid waiting until the deadline of December 31, 2024.

If you have any outstanding taxes, pay them along with any applicable interest before filing the belated return.

"File timely, gather all the documentation and make the necessary documents available. Understand your statement prior to filing and make sure your tax deducted at source (TDS) and other rebates such as Forms 16 and 16A and 26AS are being considered while filing," says Alay Razvi, partner, Accord Juris LLP.

When filing a belated return, understand the penalties involved, such as late fees and interest on unpaid taxes.

No penalty will be imposed if your income does not require mandatory filing under Section 139(1), even if the return is filed after the assessment year ends.

Keep all relevant documents ready in case the tax department requires verification.

Ensure that all information provided is accurate and that you are filing for the correct assessment year.

Be cautious with details related to losses and when claiming credit for TDS, tax collected at source (TCS), and advance tax paid.

Use the co-browsing facility for real-time assistance in filing ITR. It allows a tax department official to view and interact with your tax filing page, and provide personalised support and immediate resolution of queries.

This is particularly helpful for first-time filers, those not tech-savvy, or anyone needing guidance.

Additionally, it is beneficial for individuals with complex tax situations or those unfamiliar with online filing.

Alternatively, seek professional advice to ensure accuracy. If you discover an error after submitting your belated ITR, you can revise it online until the December 31 deadline.

E-verification of the belated return filed under Section 139(4) is mandatory for all ITRs.

"Without e-verification or submission of the ITR-V, the return will not be processed. So, while you can claim a refund through belated returns, it is essential to ensure that all necessary steps are completed to facilitate the processing of your refund," says Jain.

Keep track of any refunds due and maintain all relevant documentation for future reference.

"Finally, set reminders for upcoming deadlines and stay organised throughout the year to prevent late filings in the future," says Jain.

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Feature Presentation: Rajesh Alva/Rediff.com