If the income tax return is not submitted within the stipulated timeline it is called Belated Income Tax Return. One can still file the return following some guidelines provided by I-T department of India.
What is Due Date of filing of Return and Belated Income Tax Return
As per the Income Tax rule by the Govt of India, for all those whose income is above exempted limit must have to pay the income tax on time. Only paying the Income tax does not complete the tax filing process. Submission of return of Income Tax is a must along with the payment of due Income tax. Under Section 139(1) the normal deadline for filing the Income Tax return for the salaried or self-employed person who does not need any tax audit to be done is 31st July of a particular financial year. Any business firm who is supposed to get tax audit done before filing income tax has an extended time limit up to 30th Sept of the assessment year. Let’s discuss what is Belated Income Tax Return all about.
An overview of Belated Income Tax Return and its filing process
The question of belated Income Tax return occurs in two scenarios –
- If a person is failed to submit return of Income Tax within deadline as mentioned in Section 139(1).
- If someone has been issued a notice to submit return of Income Tax under section 142(1) of Income Tax law by a tax officer within the notice period and still has not submitted the return.
A person can still submit the IT return under above scenarios and this particular type of Income Tax return is known as Belated Income Tax Return. It can be filed anytime within the end of relevant assessment year. We can explain the scenario with an example. Let say Income Tax Return due date for the financial year 2013-14 is 31st July/30th Sept 2014.The assessment year here would be 2014-15.If any taxpayer is unable to submit the IT return within the deadline he can still submit the Belated Income Tax Return before the end of assessment year i.e. on or before 31st March 2015.
Belated Income Tax return and Penalty on Tax Payable
Under any scenario, one is liable to clear all tax dues and submit the Income Tax return on time. Penalty is applicable for the tax payer on the tax amount if he is unable to clear the due tax amount within deadline. As per the prosecutions provision under Income Tax Act, a tax payer can be levied interest on due amount of Income tax. Under Section 234A the simple interest rate is calculated 1% of total due tax amount and will be levied from the very next day of the due date of Income Tax Return.
But if the tax payer has cleared the entire tax amount within 31st July or 30th Sept as the case may be, no interest is payable on income tax on such Belated Income Tax Return provided it is submitted within the relevant assessment year.
Notable changes in time frame
Before FY 2015-16 there was a provision of filing Income Tax return within 1yr from the expiry of relevant assessment year. For example, if the Income Tax Return due date for the financial year 2013-14 is 31st July/30th Sept 2014, the assessment year here would be 2014-15.If any taxpayer is unable to submit the Income Tax return within the deadline he can still submit the Belated Income Tax Return on or before 31st March 2016.But as the number of tax defaulters increases over the time despite of repeated tax notices by I-T department, the rules of Belated Income Tax Return has been changed starting from FY 2015-16.The time limit has been reduced from 2 years to 1 year as per the changes proposed in budget of FY 2016.
Impact of recent Income Tax Rule Changes regarding Belated Return of Income Tax
As per the new rule filing a ‘revised return’ is only applicable for the I-T return submitted on time. Any Belated Income Tax Return is exempted from change.
Delayed refund process for belated return
In case of Belated Income Tax Return the refund amount applicable only from the date of filing. In this case, one has to incur the loss on interest amount already deducted on the taxable amount. The overall refund process has also become prolonged in this case.
Nutshell- Avoid delaying the filing of return of Income Tax
To avoid any possible loss or penalty it is always advisable to pay the tax and submit IT return within timeline. In case you are filing a Belated Income Tax Return, as no revision of this return would be allowed. A careful verification is essential for the belated return process. One can avail the facility of e-verification process within 120 days of submission of IT return.
