File Your INCOME TAX RETURN (ITR) by 31st July 18- Avoid penalty - Rs. 5,000 to 10,000

If you are an individual and you are wondering and feeling relaxed thinking Income Tax Return (ITR) filing is same as previous year and you will file your ITR only on last day or due date i.e. 31st July or even after that as a belated return i.e. after 31st July 2018.

Then, please take a pause and read below article carefully and reduce your tax burden.

If you are planning to file income tax after 31st July 2018 i.e. for previous year (PY) 2017-18, do note you will get penalized by Income Tax authorities by Rs. 5,000. Yes you read correctly and your vision is also correct.

Who must file tax returns?

1. Individuals who are having an annual income greater than Rs. 250,000 or more and they are under 60 years of age. 
2. and those between 60 and 80 earning Rs. 300,000 or more, 
3. and those above 80 earning Rs. 500,000 or more
4. If you’re an NRI with an income of Rs. 250,000 or more earned in India during the last year, you need to file return too. Regardless of the brackets mentioned here, you should file your returns to reclaim excess taxes paid, or for several of the other reasons mentioned below.

Do I get benefited for filing in due date ?

1. Yes, one you don't have to pay penalty for non-filing of income tax return i.e. Rs. 5000 from Assessment Year 2018-19 for the income earned in PY 2017-18.
2. Second, if you have paid excess tax and refund is expected - you will receive your refund with interest calculated at the rate of 0.5 per cent per month starting from April 1 of the assessment year.

Is it okay if I file late ?

1. Yes, so long you are happy paying extra money to the government in the form of interest and penalty
2. Interest is charged for late filing of ITR computed @1% p.m. that has to be paid at time of filing giving its detail starting 1st Aug 2018 as first month till the month in which filing is done. This means six months delay means- 6% on outstanding taxes.
3. Penalty of Rs. 5000 also has to be paid for filing after 31 July 2018 and upto 31st Dec 2018
4. After 31st Dec 2018, penalty goes upto Rs. 10,000
5. However if the total income is below Rs. 500,000, penalty amount is restricted to Rs. 1000

Belated return can still be filed with above fines. 

Click this link for more information on ITR compliance- https://www.incometaxindia.gov.in/

Hope this article will help you understand the changes made in ITR compliance and urgency of filing ITR. 

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