31st July, 2014 is the last date for filing your income tax returns. Whatever tax liability you have incurred should be paid by this date. Many of us with income tax to be paid will be busy ensuring we do not miss the deadline. Any non-payment of tax due by this deadline will demand a penalty. For others also filing your ITR by 31st July ensures you keep your accounts up to date. But what happens if you miss this deadline. Need not worry. Income Tax has a provision wherein you can file your ITR by 31st March 2016. However, there are some caveats attached when you are doing it after the due date. In general, if you do not have any tax liability then your concern will be lower. But if you have any, then there are some disadvantages when you file your ITR post 31st July which you should take into consideration.
Here are provisions applicable if you have missed the deadline of 31st July –
You Can File Belated Returns
It’s not that if you have missed this deadline you cannot file your ITR. As per income tax provisions you can file belated returns within two years from the end of relevant financial years. So for FY 2013-2014 you can file ITR till 31st March 2016. However, you are charged a penalty where you have any tax liability or you delay it beyond assessment year.
Many a times you or your CA can make a mistake while filing your ITR. If it leads to wrong assessment of your tax liability then you can end up for a tax demand of more than your actual liability. Income Tax have a provision wherein if any mistake has been done or you have left out anything then you can file a revised return within the assessment year. This is a very good provision as most of us do this exercise at the last moment and few end up making a mistake. But if you are filing your returns after 31st July, then you cannot file a revised return for any kind of correction. So ensure you do not make errors while filing your income tax returns.
No Carry Forward of Losses
In property or share transactions or any other investments you can make capital losses. But you can set off these losses with gains in next financial year. In case you do not have gains then you can carry forward such losses for next eight years or can set off from future gains? But benefit of this provision also rest on when you file your returns. If you are filing it post 31st July then you cannot carry forward these losses (except property). So if you have income from capital gains or any other source and would like to offset it or carry forward it then file your returns before 31st July.
Any tax liability has to be paid by 31st July. If you have missed this deadline you have to pay a penalty of 1% per month on the tax due. Also, if you choose to file your return in next financial year i.e. return for FY 2013-2014 in April 2015, then you have to pay a penalty of R 5000.
Sometimes when you file your returns post 31st July and seek any refund you would have observe of late processing. This is precisely due to reason that the interests on refunds are calculated from the date of filing your ITR. So if you are filing your ITR post 31st July and seek refunds then you should expect late payment of the same.
Government is simplifying income tax filing procedures. E-filing was a good move and we have benefited from it. But provisions above can hurt you sometime. It’s wiser to take note of them and file your returns timely. If you are not able to do it take assistance from a tax expert.
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