Recently there was a news buzzing in the corporate world that we have to file our taxes by August 5th. I haven’t filed it because I pay TDS every month. So what happens if we don’t file taxes?
It is a good practice to file the tax before the deadline to avoid penalty and keep a chance in hand to file revised return if there is any mistake in filing. Please check the under mentioned reasons for filing the return on official deadline:
- If you are obliged to pay any tax while filing return than a penalty of 1% per month would be charged on such tax for number of months delayed.
- In case of late return, you cannot file a revised return for any type of mistake committed while filing it late.
- The late filing also hinders you to carry forward any sort of capital gain loss or business losses.
- The period of delay would not be entitled to any interest if you intend to claim TDS refund.
Irrespective of the fact that you deposit a TDS every month, the IT return should be ideally filed on or before the penalty free deadline for the aforesaid reasons.
Even if you missed the August 5, 2017 deadline for filing your Income Tax Return (ITR), you can still file it. If you miss the final deadline of March 31, 2018 too, then you may be asked by the IT department to explain the reason for not filing with requisite proof. From next year onwards i.e. starting from April 1, 2018, if you file a late ITR and your earnings are greater than Rs. 5 lakhs, then you are liable to pay a penalty of Rs. 5,000 if the ITR is filed before Dec 31, 2018, and Rs. 10,000 penalty if the ITR is filed after Dec 31, 2018. For people whose income is less than Rs. 5 lakhs, the penalty would be restricted to Rs. 1,000. Note that it is mandatory to file your ITR if you earn taxable income. Also, if there is any discrepancy in the TDS amount deducted and the amount of tax that you need to pay, the IT department might send out a notice asking for an explanation.
If you couldn’t file the ITR within the deadline and you receive a notice from the IT department, then do not ignore it. Normally, the IT department allows ample time to respond or to file your taxes, so be diligent and get to doing it within the stipulated time-frame.
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