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Income Tax Taxation

Consequences of Late ITR Filing


The government gives 4 months to its citizens to file their Income Tax Returns every Assessment Year. ITR filing is an easy and online process, so the time given by the government to its taxpayers is more than enough. The last date to file your ITR for the FY 2018-19 was 31st August 2019. A penalty will be charged on those who were not able to file their ITR before the due date. Apart from the penalty, there are other consequences and inconveniences attached to the delay in filing of Income Tax Returns.

Penalty for Late ITR Filing

If you miss the last date of ITR filing, a late filing fee of up to Rs 10,000 can be charged as per the changed rules notified under the section 234F of the Income Tax Act. Amount of penalty charged for low- income taxpayers is different from the amount charged for high –income taxpayers.

Penalty for low-income taxpayers: For taxpayers whose annual income does not exceed Rs 5 lakhs, an amount of Rs 1000 is charged as a penalty. This penalty charged is irrespective of the date when ITR is filed after the due date.

Penalty for high- income taxpayers: For taxpayers whose annual income is more than Rs 5 lakhs, an amount of Rs. 5000 is charged as a penalty.

Penalty for under-reporting of income: There are provisions for levying a penalty for under-reporting the income by tax evader. The penalty in such cases is 50 % of the amount of tax payable.

Jail Term: It is an extreme step taken by the assessing officer only when the ITR is not filed even after multiple tax notices. The period of the jail term varies from 3 months to 2 years. Authorities take this step in cases where the amount of unpaid tax is significantly large and is not paid for a more extended period.

Every company or a firm and every individual whose annual income is more than the exemption limit of relevant FY are liable to pay late ITR filing fees. All these decisions are made as per Sections 139 and 234F of the Income-tax Act, 1961.

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Income Tax Return Filing

  • ITR Filing between 1st August to 31st December – Rs. 5000/-
  • ITR Filing after 31st December – Rs. 10,000/-
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Benefits of filing ITR on time

Tax refund: If the taxpayer has to receive a refund from the income tax department, he should file his ITR on time to get the refund as early as possible.

Easy Loan Approval:  While applying for loans, all major banks can ask for a copy of tax returns. Copy of ITR can come handy while applying for loans such as vehicle loan (2-wheeler or 4- wheeler), House Loan etc.

Visa approval: While applying for Visa, most of the embassies and consulates demand a copy of ITR from the past couple of years.

Avoid Penalty: This is the most obvious benefit of filing your ITR on time. If the taxpayer is not able to file ITR before the due date, in such cases tax officers have the right to impose a penalty up to Rs 5000.

Consequences of Not Filing ITR on Time:

Apart from the penalty charged by the authorities, there are many other consequences faced by the taxpayers. The maximum penalty charged on late ITR filing is up to Rs. 10,000. Other consequences faced by taxpayers are as follows:

The interest levied:  If a Taxpayer is not able to file the ITR before the due date, an interest of 1% is levied on the unpaid tax amount every month. This interest is levied under section 234A of the Income Tax Act.

Less time to revise your return: Earlier, taxpayers had two years to revise and resubmit their inaccurate ITR. However, now if there’s a mistake in ITR, under the changed rules, taxpayers will have to make necessary relevant changes before the end of the assessment year.

Delay in refunds: If a taxpayer is eligible for refund and interest on that refund, he will not receive any interest on the refundable amount if ITR is not filed on time.

Mandatory Applicability to file ITR

It is compulsory for the following to file ITR:

  • A Company or a Firm whose annual income is above the exemption limit of tax deduction.
  • Any person whose annual income is more than the exemption limit of relevant Financial Year.
  • A taxpayer who is a resident of India but have property outside India. Moreover, if the resident of India has signing authority in a foreign account, it becomes mandatory for him to file ITR on time.
  • ITR has to be filed for any income from property under a charitable trust, religious purpose, medical institution, hospital or any other institution.


Considering the penalties levied on late ITR filing, it is advisable to file your ITR on time. As a consequence of not filing ITR even after multiple tax notices, tax evaders may have to land in Jail. Taxpayers can avail various benefits as well if they file their ITR on time. 

Shubham Chauhan

A passionate legal content writer, a nature enthusiast, an avid reader, and a part-time thinker. By means of conducting in-depth research on industry related topics, Shubham often builds flawless and intelligible legal content for populace from all walks of life.

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