ITR filing: Late fee to jail term – If you miss due date

Income tax return (ITR) filing for AY 2022-23: The due date for income tax return (ITR) filing is 31st July 2022, which means taxpayers have just few hours in hand to file their ITR. The income tax department has been requesting earning individuals to fuel their I-T return within the given due date and avoid late fee or penalty. However, for information to the taxpayers, on missing the ITR filing due date, earning individuals will have to pay up to 5,000 late fee whereas they may be prosecuted for 6 months to 7 year jail term as well. Apart from this, they won’t be able to carry forward or set off losses against the profit or income of the year.

Monetary penalty on missing the ITR filing due date

Speaking on the monetary penalty being levied on the taxpayers filing their ITR after the due date, Mumbai-based tax and investment expert Balwant Jain said, “If an earning individual misses to file ITR within the given due date, then he or she would be able to file its ITR on paying the late fee. The late fee would be 5,000 if the annual taxable income is 5 lakh or more whereas late fee would be 1,000 if the taxable income is below 5 lakh.” He said that above-mentioned late fee will be applicable when the taxpayer files ITR after due date of 31st July 2022 but before the last date of 31st December 2022.

“If an earning individual misses to file ITR after the last date of 31st December 2022, the income tax department may levy penalty of 50 per cent to 200 per cent on taxpayer’s actual income tax outgo, in addition to the tax and interest liability till the date a taxpayer files its ITR in response to the income tax notice from the department,” Balwant Jain said.

You may land in jail too

The Mumbai-based tax expert went on to add that the Indian government has the power to initiate prosecution against the earning individual who has missed to file ITR by the given last date i.e. 31st December 2022 for AY2022-23.

“Current income tax rules prescribe a minimum sentence of 6 months of imprisonment and a maximum sentence of 7 years of imprisonment. It is not that the department can launch prosecution against you in each and every instance of failure to file the ITR. The income department can launch prosecution only in case the amount of tax sought to be avoided exceeds 10,000,” Balwant Jain said.

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