Income Tax Return (ITR) filing: Taxpayers alert! Last day to save Rs 10,000 fine

There are various due dates for filing Income Tax Return (ITR), however, experts direct taxpayers to file their ITR by end of December 31 of every year. This is because of the late fees and penalties a taxpayer will be liable to pay. While an Indian citizen is eligible to pay taxes on income above Rs 2.5 lakh, they are also required to pay an extra sum on income from other sources as well, like interest earned on savings, capital gains from equities, etc. However, the Income Tax Department also gives a privilege to citizens in securing a portion of taxes paid in the form of ITR. In short, ITR helps in reducing the taxes a citizen is liable to pay. 

With less than a day left for 2018 to end, taxpayers must hurry and file their ITR by end of December 31, as per Archit Gupta, Founder & CEO ClearTax. 

Individuals whose gross total income exceeds Rs.2,50,000 (below 60 years), Rs. 3,00,000 (above 60 years but below 80), and Rs. 5,00,000 (above 80 years) are required to file their Income Tax Returns(ITR) every year. The due date to file the tax returns is 31 July of the assessment year. Similarly, Companies (subject to audit under any law) are also required to file their income tax return by September 30 of the assessment year. It depends on the tax authorities to extend the due date of filing and give more time to the taxpayers to file their taxes. 

For Financial Year(FY) 2017-18, July 31, 2018 was the due date to file ITR by the individuals, HUFs, businesses (not subject to audit under any law); this date was further extended to 31 August 2018. Similarly, 30 September 2018 was the extended deadline for filing of ITR by companies, businesses (subject to audit under any law) which was earlier extended to 15 October and then finally to 31 October 2018.

The taxpayers who failed to file their returns by August 31 or October 31, respectively, had to pay a late fee of Rs. 5,000. The late fees will double itself, if the failure continues beyond 31 December 2018. However, if the income is below taxable limit then this late fee won't be applied even if the return is filed after the deadline. The taxpayers will have to pay Rs. 10,000 as late fees if the tax return is filed after 31 December but before the end of the assessment year i.e 31 March 2019. 

A small taxpayer whose gross total income does not exceed Rs. 5 lakh then the maximum late fees will only be Rs. 1000 in all circumstances. This provision of late fees comes under section 234F which was introduced in Budget 2017. 

If you are an individual having a gross total income of more than Rs. 5 lakh in the financial year 2017-18, you should have filed you ITR by 31 August 2018. If you missed the August deadline then you are liable for Rs. 5,000 late fees; this late fees will increase if you miss the December deadline also. After 31 December 2018, you will end up paying Rs. 10,000 as late fees for late return. 

You should file your ITR by 31 December 2018 and avoid extra late fees of Rs. 5,000. Delaying your return of taxes beyond 31 December 2018 will attract a late fine of Rs. 10,000.