The deadline for filing income tax returns (ITRs) is July 31st this year.” People who miss the deadline need to be aware that there could be dire repercussions. Individuals who miss the July 31 deadline will be able to file a late return by December 31, 2024. However, if your Income Tax Return (ITR) is not filed by the deadline, you will automatically be assigned to the new tax system.
This means that you will have to forfeit the option to select the old regime for the respective financial year as you will be automatically placed under the new tax regime. Currently, there are two tax regimes being operated: the old regime and the new regime which was introduced in 2020 which features revised tax slabs and concessionary rates.
If you fail to file your ITR by July 31, you have the option to submit a late return and as per Section 234F of the Income Tax Act, late filing fees of ₹5000 can be levied. If your income does not exceed ₹5 lakh, the late filing fees is ₹1,000.
Additionally, interest will be charged at the rate of 1% per month or part of the month on the outstanding tax amount from the due date but penalty imposed cannot surpass the amount of tax in arrears.
Those who file their income tax returns late will also be unable to carry forward any capital losses they may have suffered. This means that these taxpayers will be unable to use their losses to offset future profits, resulting in a greater tax liability in the coming years.
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