CBDT extends Income Tax Filing deadline for AY 2021-22 to 15 March; check details here

 CBDT extends Income Tax Filing deadline for AY 2021-22 to 15 March; check details here

If you fail to file the ITR within the due date, you will be required to pay penal interest on the unpaid tax liability if there is any

The deadline to turn in income tax returns (ITR) has been extended to 15 March, 2022, according to several media reports.

The final date to file tax audit reports has also been delayed and is now 15 February, 2022.

The decision comes in the backdrop of several chartered accountant associations demanding the government to extend the deadline, as they cited the COVID-19 impact and the glitches in the e-filing portal as the reasons behind the delay in submissions, Monycontrol said in a report.

As per the report, the last day for filing ITRs for individual taxpayers had lapsed on 31 December 2021, as per the erstwhile order issued by the Central Board of Direct Taxes (CBDT). The same has now, through the latest finance ministry circular, has been extended till 15 March.

The deadline for filing tax audit reports was earlier fixed as 15 January 15 2022. For submissions to be made following the specified date, a penalty of Rs 5,000 was to be imposed.

The Central Board of Direct Taxes (CBDT) in a statement said that on consideration of difficulties reported by the taxpayers and other stakeholders due to COVID and in electronic filing of various reports of audit, it has decided to further extend the due dates for filing of Income Tax Returns and various reports of audit for the Assessment Year 2021-22 (2020-21 fiscal).

ITRs filed till 28 December

According to a report by ANI, 4.86 crore ITRs were filed till 28 December. The total number of ITRs filed for the assessment year 2020-21 (FY 2019-20) stood at 7.38 crore. It stood at 6.78 crore for FY 2018-19 and 6.74 crore for FY 2017-18. There has been a consistent increase in the number of ITRs filed over the years.

Clearly, a substantial number of people have not yet filed their income tax returns. The number of ITRs filed till December 28 is 2.52 crore less than the total number registered in the previous year.

What happens if you miss the deadline?

You can still file your returns, but there are financial implications.

Before delving into the financial implications, it is important to note the difference between ‘due date’ and ‘last date’ for ITR filing. The due date is the date by which ITR can be filed without paying any late fees. The ITR can be filed until the last date with paying applicable late fees.

Assessment year (AY) refers to the year following the financial year (FY) in which income earned by you is assessed. For instance, FY 2020-21 the assessment year is 20221-22.

If you fail to file the ITR by the due date, you can still file the return called ‘Belated Return’. The belated return can be filed as per section 139 (4) of the Income Tax Act, 1961. However, the assessee would be liable to pay late filing fees and penal interest, and also forego interest benefits on excess taxes paid.

The late fee penalty for filing the ITR after the due date is upto Rs.5,000. Small taxpayers whose total taxable income during the financial year under review does not exceed Rs.5 lakh will have to pay a maximum penalty of Rs.1,000 if the ITR is filed after the due date but before the last date.

Please note that if your income is below the taxable limit then you won’t be required to pay any penalty. However, there is a catch! If a resident individual has income from foreign assets the late filing fees will be levied even if the gross income does not exceed the tax exemption limit. The basic tax exemption limit is Rs.2.5 lakh irrespective of the taxpayer’s age.

Until the financial year 2016-17, there was no penalty for filing belated tax returns. In 2017, provisions were added in the Income Tax Act for levying penalties on belated return filing. The penalty was introduced from the financial year 2017-18. The maximum penalty was set as Rs.10,000. Effective from FY 2020-21 the penalty has been cut to half. Now the maximum penalty stands at Rs.5,000, ANI said.

However, it’s not just the late fee penalty that should bother you. There are other financial implications also of not filing the return within the due date.

If you fail to file the ITR within the due date, you will be required to pay penal interest on the unpaid tax liability if there is any.

Moreover, you will not be able to carry forward losses even if you have paid all the taxes in time. If there is any loss from business and profession including speculation business, short-term or long-term capital losses, or any other losses except for loss from house property upto Rs.2 lakh, cannot be carried forward.

If you are eligible to carry forward losses, you must file the return before the due date. Taxpayers are allowed to carry forward short-term and long-term capital losses to a maximum of eight assessment years immediately following the assessment year in which the loss was first computed.

Also, you cannot set off losses against the current year’s income if you fail to file the return before the due date.

Another important factor to note is that if you fail to file the return before the due date you will not receive interest on refund for the excess taxes paid for the period of delay.

There are speculations that the government may extend the due date further considering the COVID-19 situation. However, there are also chances that the date may not be extended. So, if you have still not filed your ITR, do it now.

With inputs from agencies

Read all the Latest News, Trending NewsCricket News, Bollywood NewsIndia News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.

FP Staff

Leave a Reply

Your email address will not be published. Required fields are marked *