Late Filing Penalty under Section 234F of the Income Tax Act for FY 2023-24

Deadline for Individual Taxpayers to File AY 2024-25 (FY 2023-24) ITR is July 31, 2024. Late filing incurs penalties and other inconveniences.

Late Filing Penalty

For individual taxpayers, the deadline to submit your ITR for AY 2024-25 (FY 2023-24) is July 31, 2024, unless extended by the department. Failure to file on time can result in penalties, along with additional repercussions and inconveniences.

Late Filing Penalty under Section 234F

Under the amended regulations in Section 234F of the Income Tax Act, filing your ITR after the deadline can result in a maximum penalty of Rs. 5,000.

Starting from the fiscal year 2021, the income tax department has reduced the maximum penalty for late filing of returns to Rs. 5,000 from Rs. 10,000.

Breaking it down for FY 2023-24; if you file your ITR before July 31, 2024 (September 30, 2024 for audit and October 31, 2024 for transfer pricing cases), no penalty will be imposed.

For filings after July 31, 2024, the penalty ceiling will be raised to Rs. 5,000. However, in a relief to small taxpayers, the IT department has stipulated that if your total income does not exceed Rs. 5 lakh, the maximum penalty for delay will be only Rs. 1,000.

Late Filing Fee Details

e-Filing DateTotal income below Rs 5 lakhTotal income above Rs 5 lakh
31st July 2024Rs 0Rs 0
Between 1st August 2024 to 31st December 2024Rs 1,000Rs 5,000

Shortened Timeframe for Amending Your Return

Late Filing Penalty

Suppose you’re submitting your ITR and find an error. With the revised rules, you must correct it by December 31 of the assessment year (for ITRs from FY 2017-18). Previously, taxpayers had a 2-year window to revise ITRs. This has now been reduced to 9 months from the end of the financial year. Hence, filing earlier gives you a longer window to revise and rectify any errors in your returns.

Interest Payment

Failure to file income tax returns by the due date incurs interest at a rate of 1% per month, or part thereof, on the outstanding tax amount according to section 234A. It’s crucial to understand that ITR filing is contingent upon tax payment. Penalty calculation begins from the day following the due date, typically July 31 of the relevant assessment year. Hence, delaying payment results in higher penalties.

Loss Carryforward is Prohibited

If you’ve experienced losses during the year, such as capital gains or business losses, ensure you file your return by the due date. Failure to do so will prevent you from carrying forward these losses to offset against income in future years. However, losses from house property can still be carried forward to future years, even if you file after the due date.

Refunds Not Received Right Away

If you’re eligible to receive a refund from the government for overpaid taxes, it’s essential to file your return before the deadline to expedite the refund process.

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