5 Benefits Of Filing Your Income Tax Return On Or Before 31st July 2017
July end is just around the corner and for the uninitiated, this is no ordinary month ending! For one has to file income tax return in this month itself. Even if all the taxes have been paid, one would still lose out on certain benefits if income tax return is not filed by the due date – 31st July 2017.
(1) Deposits Made During Demonetization
Filing your return by the deadline is important specially for FY 2016-17 in case you have made cash deposits of Rs 2 lakh or more in your bank account during the demonetization period i.e. between Nov 9, 2016 to Dec 30, 2016. This is a mandatory process and failing to do so may fetch a letter from the department asking you to file your return if not filed in time.
(2) Losing Out On Interests
If you claim a refund in your return filed before due date, you would lose some of the interest paid by the tax department on such refund. Note that interest is computed from 1st April till the date of grant of refund.
However, if a refund is claim on a return filed belatedly, then interest is computed from the actual date of filing the return till the date when refund is granted.
(3) No carry forward of losses
Except loss from house property, if you file a belated return you cannot carry forward losses.
Kuldip Kumar, Partner and Leader Personal Tax, PwC says:
“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 by the tax payer. The return filer will not be allowed to carry forward these losses even if all taxes have been paid in time if the return is belated.”
(4) Unpaid Tax Attracts Penalty
If you have any unpaid tax liability, filing your return after the due date would result in levy of penal interest at 1% per month from the due date of filing the return till the actual date of filing.
(5) Penalty If Tax Not Filed By The End Of Assessment Year
A penalty of Rs. 5,000 can be levied by the tax authorities if one does not file tax return by 31st March of the Assessment year, i.e. the year immediately after the financial year for which the return is to be filed. This penalty can be levied even if no taxes are due.
Comments are closed.