Who doesn’t have to pay a late charge if they file their tax return after the deadline?

Who doesn’t have to pay a late fee if they file their tax return after the due date?

If you have taxable income of more than Rs 5 lakh, you’ll have to pay a penalty of Rs 5,000 if you file your ITR after the deadline. For people having taxable income less than Rs 5,00,000, the penalty is Rs 1,000. However, some people will be able to file their ITR beyond the deadline without incurring a late fee.

The deadline for filing FY20202-21 income tax returns (ITR) was December 31, 2021. Individuals who have not yet submitted their ITR will be charged a late fee if they file one late.

If you have taxable income of more than Rs 5 lakh, you’ll have to pay a penalty of Rs 5,000 if you file your ITR after the deadline. For people having taxable income less than Rs 5,00,000, the penalty is Rs 1,000.

However, some people can file their taxes after the deadline and avoid paying a penalty.

WHO CAN FILE AN ITR AFTER THE DEADLINE WITHOUT BEING CHARGED A LATE FEE?

People with gross total income below the basic exemption limit are excused from paying a late charge if they file their ITR after the due date.

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The basic exemption limit that an individual is entitled to is determined by the tax regime. The baseline exemption ceiling under the new regime, where there are no common exemptions, is Rs 2.5 lakh, regardless of age.

Meanwhile, under the previous income tax system, the baseline exemption level was determined by the individual’s age.

It should be mentioned that under the previous tax regime, the basic exemption ceiling for residents under 60 years of age was Rs 2.5 lakh, while it was Rs 3 lakh for those over 60 but under 80 years of age. Citizens over the age of 80 have a basic exemption ceiling of Rs 5 lakh.

As a result, if these conditions apply to an individual, he or she will be able to file an ITR without incurring a late fee even if the deadline has passed.

TERMS AND CONDITIONS APPLY

Even for people who meet the basic exemption limit criteria, there are several exceptions. Even though their gross total income is less than the basic exemption ceiling, certain individuals are required to file an ITR.

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Individuals who fall under Section 139(1)’s seventh proviso, for example, will be required to pay a late charge even if their gross total income is less than the basic exemption amount.

1) Those who have deposited a sum or an aggregate of amounts in one or more accounts with a bank or co-operative bank in excess of Rs 1 crore come under the above-mentioned group.

2) Those who have spent more than Rs 2 lakh on themselves or another person for travel to a foreign country also fall into this category.

3) Those who have spent an amount (or an accumulation of amounts) on energy consumption in excess of Rs 1 lakh also fall into this category.

Another exemption is when a taxpayer has overseas assets, such as foreign company stocks. Simply put, you must pay a penalty for late ITR filing if your gross total income is below the basic income threshold but you have income from foreign assets.

Have you missed the deadline for filing your ITR? Here’s what you can do

Have you missed the deadline for filing your ITR? Here’s what you can do

The Income Tax Return (ITR) for the fiscal year 2020-21 was due on December 31, 2019. If you miss the deadline, you can still submit a ‘belated ITR.’

A ‘belated return’ is when an income tax return is filed beyond the due date. However, taxpayers will be required to pay a penalty fee, as set forth in the Finance Act.

Section 234F of the Income Tax Act imposes a late fee for failure to file a return within the deadline for any assessment year, according to the guidelines. The fine may be as much as $5,000.

According to reports, under this provision, a late ITR can be filed up until March 31, 2022, with a $5,000 penalty. Taxpayers will only have to pay a fine of $1,000 if their total income does not exceed $5 lakh. If your income is less than $2.50 lakh, you will not be charged a late fee.

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If there been a gap in filing the original tax return, those who have already filed their ITR might file a revised return. The deadline to file amended income tax returns for the fiscal year 2021-22 is March 31, 2022.

The I-T department said on Saturday that around 5.89 crore income tax returns for the 2020-21 fiscal year were filed on the new e-filing platform by the December 31 deadline. Over 46.11 lakh ITRs were filed on the last day of the year, December 31.

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Due to the second Covid-19 wave in the country, the deadline for filing income tax returns for the fiscal year was initially delayed from July 31, 2021 to September 30, 2021. It was subsequently extended till the end of the year after complaints about technical issues with the new IT platform for filing returns.

How to quickly insert LTCG information on several SIP transactions

How to quickly insert LTCG information on several SIP transactions

Making long-term investments in equities through Systematic Investment Plans (SIPs) in equity mutual funds (MFs) is considered a substantially less-risky option. However, once they have redeemed their assets, they are faced with the difficult chore of inputting investment-by-investment information of long-term capital gain (LTCG) in their Income Tax Return (ITR).

Capital gains come from the redemption, changeover, or change of plan of such MF units. Short-term capital gain (STCG) or loss results from transactions in equity MF units made within one year of the date of investment, whereas long-term capital gain (LTCG) or loss results from transactions made after one year of the date of investment.

Taxpayers investing in ELSS (equity-linked saving plan) and other equity-oriented schemes had no trouble filing their ITRs while the LTCG on transactions in equity MFs was tax-free.

However, since the LTCG on equities became taxable, such investors have found it difficult to file their tax returns, especially if they invest through the SIP route.

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While the declaration of STCG on stocks and equity-oriented MF schemes has remained unchanged, ITR Forms (excluding ITR 1 and ITR 4) now include a separate page called 112A for filling out details about LTCG on equities and equity-oriented MF schemes.

In the 112A page, equity investors must submit investment-by-investment details of stock and/or unit redemptions in equity MF schemes that result in LTCG.

As a result, even salaried investors who redeem their ELSS or other equity-oriented plan investments will not be able to utilise ITR 1.

Furthermore, the entry methods for investments made on or before January 31, 2018 and those made after that date will be different.

The 112A page can be filled in one of two ways: by downloading the CSV spreadsheet, filling it out, and uploading it, or by manually entering each entry in the page.

While typing hundreds of entries in the CSV spreadsheet and uploading them may be a faster means of filling the page, the compatibility and precision with which the fields are filled often results in the sheet being rejected at the time of uploading.

As a result, instead of utilizing the CSV spreadsheet, it may be easier to enter individual facts linked to lump sum investment redemption on the page.

For MF clients who invest through the SIP route, however, entering investment-by-investment details for each program for each month takes time and patience.

Investors may group the data of investments made before and after January 31, 2018 separately for each plan that is redeemed on the same day to limit the number of entries and save time.

‘Cost of acquisition,’ ‘Full Value of Consideration,’ and ‘Expenditure entirely and exclusively in connection with transfer’ must all be entered for investments made after January 31, 2018.

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‘ISIN Code’, ‘Name of the Share/Unit’ (which will be automatically taken by the system), ‘No. of Shares/Units’, ‘Sale-price per Share/Unit’, ‘Cost of acquisition’, ‘Fair Market Value per share/unit as of 31st January, 2018’, and ‘Expenditure wholly and exclusively in connection with transfer’ are the entries to be made in the 112A page for investments made The ‘Full Value of Consideration’ is calculated by multiplying the number of shares/units by the sale price per share/unit.

The only variable input installment-wise for the same equity-oriented MF scheme units acquired through SIP on or before January 31, 2018 and redeemed on the same date is the number of units, which varies with the date of investment as markets fluctuate.

The cost of acquisition will be the same for each instalment because the SIP amount is fixed for each instalment. As a result, the total cost of acquisition for a certain number of SIP instalments redeemed on the same day can be calculated by multiplying the SIP amount by the number of instalments. For example, the total cost of buying will be Rs 10 lakh if 100 instalments are paid on or before January 31, 2018, with a SIP amount of Rs 10,000.

Because the sale-price per unit remains the same for the particular scheme on the same day of redemption, the total number of units redeemed on that day can be calculated by adding the units against the 100 SIPs and entering as a single transaction. As of January 31, 2018, the ISIN Code and the Fair Market Value per share/unit will remain unchanged.

To save time, instead of making 100 entries for the units of the same equity-oriented MF scheme acquired on or before January 31, 2018 and redeemed on the same date, a single entry for the units of the same equity-oriented MF scheme acquired on or before January 31, 2018 and redeemed on the same date may be made.