What is Belated ITR?
Belated return (Return under section 139(4)) simply means the filing of income tax return after the due date or extended due date. A belated return can also be called a late return or delayed return. You must be aware that under the Income-tax Act, 1961, there is section 139 which casts responsibility on persons to file an income tax return and in this section different statutory due dates have been fixed depending upon the assessee and these due dates can be extended by Government (i.e. executives) depending upon circumstances and generally, these due dates are extended by the Government because of last-minute rush or traffic, income tax site does not work properly and in exceptional circumstance e.g. flood, earthquake, epidemic like COVID-19, etc.
The due date of ITR filing for individuals, whose accounts are not to be audited has been extended twice – first from the original return filing date of July 31, 2021, to September 30, 2021, and then to December 31, 2021.
The due date for ITR filing was 31st December 2021 whereas the last date for ITR filing for FY 2021-22 is 31st March 2022. There is a difference between ITR due date and ITR last date.
According to the Income Tax (I-T) department, an assessee who does not submit a return of income within the deadline is allowed to file a belated return at a later stage. The belated ITRs can be filed voluntarily after the normal deadline, up to 31 March of the assessment year. Thus 31st March 2022 is the last date for ITR filing for AY 2021-22. If the March deadline is missed, then the taxpayer cannot voluntarily file ITR. In such a case, the ITR can only be filed in response to a notice from the Tax department.
What are the provisions?
Section 139(4) of the Income Tax Act contains provisions relating to the filing of belated returns.
Belated return means the filing of income tax returns after the due date or extended due date. A belated return can also be called a late return or delayed return.
The belated returns can be filed before the end of the assessment year or before the completion of the assessment whichever is earlier. Thus, the belated ITRs can be filed voluntarily after the normal deadline, up to 31 March of the assessment year.
Belated Returns filed under Section 139(4) can also be revised.
The process of filing a belated return is the same as filing the return on or before the due date.
What are the consequences of not filing an Income Tax Return?
I. Interest
Apart from the penalty for late filing, interest under section 234A at 1% per month or part thereof will be charged on the unpaid tax amount. The calculation of the interest will start from the date falling immediately after the due date i.e. 31 December 2021 for AY 2021-22. So, the longer you wait the more you pay.
If the outstanding tax liability is Rs 1 lakh or more, the interest will be levied from the original due date till the date of filing ITR. The original due date for AY 2021-22 was 31st July 2021.
II. Late Fee & Penalty
A belated income tax return attracts a late filing fee under Section 234F of the Income Tax
a. Gross Total income is below the basic tax exemption limit i.e 2,50,000- NIL
b. Gross Total Taxable income during the financial year doesn’t exceed Rs.5 lakh- Rs.1,000
c.Gross Total taxable income during the financial year exceeds Rs. 5 Lakh – Rs. 5,000
III. Carry forward loss:
If you file a belated return you cannot carry forward losses (except loss from house property). Losses under the following heads of income: – Income from business and profession including speculation business, capital gains, and income from other sources, cannot be carried forward in case a belated return is filed. You will not be allowed to carry forward these losses even if all taxes have been paid in time.
