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Why one should not miss deadline for filing ITR

August 30, 2018

This year, July 31st is a pretty important day – it is after all the last day for filing Income Tax Returns (ITR). However, more often than not, many of us tend to wait till the very last moment before e?filing Income Tax Returns on

The following is a short list of 5 reasons why everyone should consider filing their income tax return

online not just before the due date but actually well in advance.

Avoiding Penalties and Fines

Just as late payment of your credit card or phone bill leads to penalties being levied, so does filing your

taxes after the due the date. This is especially true if you are liable to pay additional taxes at the time

of filing.


Particulars Fee



Return is filed on or before 31st December of Assessment Year but after due date

and total Income exceeds Rs. 5 Lakh : Rs.5000


Return is filed on or before 31st December of Assessment Year but after due date

and total Income do not exceeds Rs. 5 Lakh: Rs. 1000

In any other case :Rs.10000


Getting a Chance to Revise Your Returns

The ITR filing process might have been simplified but still mistakes can happen in the form of

overlooked income, missed tax benefits, etc. In case you have filed your ITR in a timely manner, you

do get opportunities to revise your returns even after the due date has passed. Common mistakes,

such as missed income and extra tax paid, can cost you in the long term whether through fines

imposed by the IT Department or through loss of tax refunds. Best of all, as long as the initial ITR was

filed before the due date, you can file the revised returns any time before the end of the current

financial year. Thus as long as the ITR is filed by 31st July 2017, the revised returns may be filed any

time before the 31st of March 2018.


Preventing Interest Loss on Refunds

Tax payers are entitled to a 6% annual rate of interest on the extra tax paid if the refund amount

exceeds 10% of the total tax payable. Such refunds are most commonly available to individuals who

have ended up paying extra tax through advance tax or TDS. In case the ITR is filed within due date,


the interest accrued on the refund is calculated from the 1st of April of the Assessment Year to the

date on which the refund amount is actually processed. However, in case of late filing by the tax payer,

the interest is computed from the date of actual filing till the date on which the refund was processed

so at least 4 months’ worth of interest from April to July will be lost in case the ITR is filed after the

due date. This loss of interest can be quite substantial if you have a large tax refund due to you.


Carrying Forward Losses

In case you incur losses in business income, capital gains, income from other sources, etc., these can

be carried forward to the next financial year and provide tax relief in the subsequent year.

Unfortunately, such losses cannot be carried forward in case the ITR is filed after the due date. The

carrying forward of losses is also not allowed even if all taxes that were due had been paid in a timely

fashion even though the ITR was filed after due date. The only exception to this rule is the loss incurred

on income through property.


Eliminating Last Moment Stress

Even though filing Income Tax Returns has definitely become a lot easier through the years, in case

you wait till the last minute to file your taxes, there is a good chance you might miss out one or more

tax savings that were due to you. This can happen because you might not have sufficient time to collect

relevant documents such as TDS certificates, loan repayment statements, interest certificates, Form

26AS, etc. which are necessary to complete the process accurately. Additionally, if you wait till the last

moment like a majority of tax payers, you might find that the e?filing income tax website is overloaded

with requests leading to all manners of technical failures, which might end up delaying the ITR filing

process. This sort of stress is definitely avoidable if you proactively file ITR online well before the due




The above reasons might be the main ones but they are definitely not the only reasons why an

individual should consider filing their Income Tax Returns before the due date. In recent years,

submission of ITR is sometimes demanded by banks as an income proof when granting a loan as well

as by foreign visa granting authorities as proof of financial stability. In case your ITR shows that it was

filed after the due date, it might just result in a poor impression of your credit worthiness/financial

discipline and that’s easy enough to avoid just by filing your tax returns in a timely manner.



CA. Harsh Patel