Why you must file your ITR before July 31
The last date to file income tax returns (ITR) for the financial year 2023-24, corresponding to the assessment year 2024-25, is July 31, 2024. An ITR is a declaration form submitted by taxpayers detailing their income, expenses, as well as other relevant financial information for a specific financial year. It is crucial to file your ITR before the deadline, in order to avoid penalties and interest on the outstanding tax amount.
Financial year v/s assessment year
The financial year spans from April 1 to March 31. Subsequently, the assessment year follows, assessing and taxing income earned during the preceding financial year. For example, income earned between April 1, 2023, and March 31, 2024 (FY 2023-24), will be assessed in AY 2024-25.
Consequences for delayed ITR filing
Taxpayers would be liable to pay simple interest under Section 234A of the Income-tax Act at a rate of 1% for every month or part of a month, says Suresh Surana, a practicing chartered accountant. Additionally, late-filing fees may apply, with taxpayers possibly liable to pay late fees of ₹5,000 under Section 234F, if the return is furnished after the due date specified under Section 139(1).
Benefits of timely ITR filing
Filing the ITR before July 31 has several benefits, including timely refunds and facilitating loan approvals. However, missing this deadline could prevent taxpayers from carrying forward losses incurred on sale of stocks or mutual fund units to future years. Vikas Dahiya, Director at ALL India ITR, warns that late filers might face increased scrutiny from tax authorities, possibly leading to audits and further inquiries.
Belated tax return and revised ITR filing
If you miss the July 31 filing deadline, you can still file a belated return, allowed up to three months before the end of the relevant assessment year. In case of any mistakes or ommisions in the original or belated return, taxpayers can file a revised ITR. This can be filed within two years from the end of the relevant assessment year, but should not result in a reduction of tax liability.
