Penalty for late filing of Income Tax Return for FY 2023-24 

Worried about the late fees for filing taxes? Before the deadline, file your Income tax return with 24eFiling. 

Filing your income tax return (ITR) on time is crucial to avoid legal issues as well as penalties. However, if you miss the deadline, you could face several consequences. But you can pay a penalty for late tax filing and get your ITR filed. So, how much is the late penalty for taxes? This blog will explain the penalty for late filing of income tax returns, helping you understand the importance of timely compliance of your ITR. 

What is an Income Tax Return? 

An Income Tax Return is a form used to declare your annual income to the Income Tax Department. It includes details of your earnings from various sources like salary, business, investments, etc., and helps the government calculate the tax you owe or the refund you are eligible for. 

Why is timely ITR filing important?

Non filing of ITR leads to penalty for late tax filing. Apart from penalties, late filing leads to some consequences and inconveniences. Here, we will see the benefits of filing your ITR on time: 

• Avoid Penalties:
  • Late filing will lead to penalties and interest. 
• Carry Forward Losses:
  • You can carry forward losses to subsequent years. 
• Quick Refunds:
  • Early filers get quicker refunds. 
• Legal Compliance:
  • It helps you stay compliant with tax laws, avoiding legal issues. 

Penalty for late filing of Income Tax Returns – Section 234F

The Income Tax Act imposes a late fee for filing taxes under Section 234F to discourage taxpayers from delaying their ITR submissions. This fee is applicable if you miss the due date for filing your return.  

The fee for filing taxes late varies based on the date of filing and the total income of the taxpayer. This tiered penalty system underscores the importance of timely compliance and helps maintain the integrity of the tax filing process. The table details the late fees for filing taxes under Section 234F. 

Date of filing	Total Income (up to INR 5 Lakh)	Total Income (above INR 5 Lakh)
On or before the due date	No Fee	No Fee
After the due date but before Dec 31	INR 1,000	INR 5,000
After Dec 31 but before Mar 31	INR 1,000	INR 10,000

How much is late fee for taxes?

The table above clearly explains what is the penalty for non filing taxes based on deadline and income structure. If you miss the deadline for filing your ITR, you may face the following penalties: 

• Fee for filing taxes late under Section 234F 
  • The Income Tax Act imposes a late fees for filing taxes under Section 234F: 
    • For returns filed after the due date but before December 31: A fee of INR 5,000. 
    • For returns filed after December 31 but before March 31 of the next year: A fee of INR 10,000. 
    • For taxpayers with a total income of up to INR 5 lakh: A reduced fee of INR 1,000. 
• Interest on Tax Due under Section 234A 
  • In addition to the fee for filing taxes late, you may have to pay interest on the outstanding tax amount under Section 234A. 
  • The interest rate is 1% per month or part of the month until the tax is paid in full. 
• Loss of Interest on refunds 
  • If you are due for a refund, filing late can result in a loss of interest on the refund amount. 
  • The interest on refunds is calculated from the date of filing the return, so delays reduce the interest you receive. 
• Inability to carry forward losses 
  • Filing your return after the due date disqualifies you from carrying forward certain losses. 
  • Losses from business and capital gains can only be carried forward if the return is filed on time. 
• Prosecution and other penalties 
  • In extreme cases, especially if you repeatedly fail to file your returns, you may face prosecution under Section 276CC of the Income Tax Act. 
  • This could result in imprisonment for a term ranging from 3 months to 7 years, along with a fine. 

What are the exceptions and reliefs late filing of ITR?

We have discussed the penalty for late tax filing. But, in some cases, exceptions and reliefs are allowed from the authorities. Some of them are as follows; 

• Belated Income Tax Return 
  • If you miss the due date, you can still file a belated income tax return until the end of the assessment year. However, penalties and interest will apply. 
• Condonation of delay 
  • In some cases, the tax authorities may condone the delay if you have a valid reason, such as a medical emergency or natural calamity.  
  • You need to apply to the Commissioner of Income Tax (CIT) for condonation. 

How to avoid penalty for late tax filing?

Filing ITR before the deadline helps you stay away from the penalties the ITR department is charging. Here are some of the areas you can consider not to pay lates fees. 

• File on time:
  • Ensure you file your ITR before the due date. 
• Seek professional help:
  • If your tax situation is complex, seek help from 24eFiling, your trusted tax professional. 
• Keep records ready:
  • Maintain all necessary documents like Form 16, bank statements, investment proof, etc. 
• Use tax software:
  • Consider using tax filing software to streamline the process. 
• Set reminders:
  • Use calendar reminders or mobile apps to remember key dates. 

Conclusion 

In conclusion, filing your income tax return on time is not just a legal obligation but also a financial discipline. The penalty for late filing of Income Tax Return can be significant, affecting your finances and future tax planning. By understanding how much is late fee for taxes and its consequences, timely compliance can be ensured and avoid unnecessary penalties. 

Timely filing of your ITR helps you contribute to the nation’s development. So, file your ITR with 24eFiling before the deadline!  

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