ITR Penalty: What is the penalty for missing the ITR submission deadline?

Last date of deposit income tax returns (ITR) for fiscal year 2021-22 is July 31, 2022. It may cost you not to meet this deadline even if you don’t have any taxes to pay. Until the 2019-20 fiscal year if the taxpayer misses ITR . deposit Deadline, the maximum penalty he/she had to pay was Rs 10,000.

However, from fiscal year 2020-21 (AY 2021-22), i.e. last year, the penalty amount has been reduced by half i.e. a person who submits an ITR record late will have to pay a maximum fine of Rs 5,000. Furthermore, if your income is below the taxable limit, you don’t even have to pay the penalty amount if you file your ITR after the deadline with some exceptions. That is why the penalty this year is half that of last year.

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These taxpayers will not have to pay a fine to file an ITR after the deadline

The penalty you will have to pay

In the 2021 budget, the government reduced the maximum time allowed for an individual (who does not need to be audited) to file an ITR by three months. Due to the reduction of the time limit for filing an ITR, a subsequent amendment was made in Section 234F of the Income Tax Act 1961 under which the penalty amount is imposed for filing a late ITR. The amount was reduced to a maximum of Rs 5,000 from Rs 10,000 earlier.

Earlier, an individual was allowed time until the end of the financial year, i.e., 31st March for filing a late ITR with a maximum fine of Rs 10,000.

From fiscal year 2020-21 (AY2021-22) onwards, the usual deadline for submitting a late ITR is December 31 (unless extended by the government). Accordingly, for the fiscal year 2021-2022 (AY2022-23), i.e. for this year, the deadline for submission of the late ITR is December 31, 2022. Rs. 5,000.

Until fiscal year 2019-20 (AY 2020-21), there was a two-tier penalty structure for missing the ITR submission deadline. If the late ITR is submitted after the expiry of the deadline and on or before 31st December, then the individual is required to pay the late registration fee of Rs 5,000. If the ITR is filed between January 1 and March 31, a late filing fee of Rs 10,000 will be charged.

Kapil Rana, founder and CEO of HostBook, a fintech startup that provides ITR filing services, says, “Pursuant to Section 234F, through fiscal year 2019-20, if a taxpayer fails to file an ITR on or before the due date, they are responsible for Pay a fee of Rs 5,000 if the tax return is filed on or before December 31 of the relevant assessment year, otherwise it will be Rs 10,000 if the tax return is filed after December 31 but as of fiscal year 2020-21, the maximum late filing fee of Rs 10,000 has been changed Rs 5,000 to be paid if the return is submitted after the expiry of the due date.”

However, there is no change in the penalty amount imposed on small taxpayers who are late for the ITR filing deadline. If you are a small taxpayer whose total income does not exceed Rs 5 lakh during the financial year, the maximum fee you will have to pay is Rs 1,000 if the ITR is filed at any time after the deadline i.e. 31 December 2022.


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