As the name suggests, a belated return is a return that is filed after the due date specified in the income tax act. The due date to file ITR for Individuals/HUF is 31st July of the assessment year (next financial year) and for Individuals to whom audit is applicable is 30th September of the assessment year. However, if a taxpayer fails to file an ITR within the prescribed time limit, then section 139(4) of the Income Tax Act enables a taxpayer to file a belated return.
For example, Shreya forgot to file ITR-1 for FY 2021-22 (AY 2022-23) on or before 31st July 2022. Here she can still file ITR by 31st December 2021. But her return will be considered as a belated return and it will be filed under section 139(4) of Income Tax Act and not u/s 139(1).
The due date for filing the belated return for the Financial Year (FY) 2021-22 or Assessment Year (AY) 2022-23 is 31st December 2022. However, to file a late return, you may liable to pay the penalty and additional interest on taxes. Besides, there are a few limitations to filing a belated return, which you can read below in the article.
Who can file Belated Return u/s 139(4)?
From FY 2019-20 onwards income tax return filing is mandatory in the following cases:
- If a person’s total Income is more than INR. 2,50,000
- The amount deposited in a current account held with a bank or cooperative bank exceeds INR 1 crore in a financial year;
Shortly, the assessee who is required to file ITR and has missed the original filing deadline can file a belated return. For which taxpayers need to select section 139 (4) from the e-Filing portal.
Consequences of late filing of ITR
The following are the consequences of filing a Belated Return:
The taxpayer is liable to pay simple interest at 1% per month or part of a month for delay in filing ITR. The calculation of interest will be from the date after the due date until the actual date of filing. For example, if the due date is 31/07/2022 and ITR is filed on 15/10/2022 then interest u/s 234A is levied for 3 months. As a result, the longer you wait to file your ITR, the more you have to pay.
From Financial Year 2021 onwards, the maximum penalty for late filing of return is reduced to Rs. 5,000/-.
- If the total taxable income is greater than INR 5 Lakh, then the penalty levied is Rs. 5,000/-.
- If the total gross Income is less than INR 5 Lakh, then the penalty levied is Rs. 1,000/-
- If the total income is less than 2,50,000, then no penalty is levied.
Limitations of filing u/s 139(4)
- Not only do you have to pay a penalty and interest on late returns but there are also specific limitations such as “No losses are allowed to carry forward” under the heads “capital gain,” and “business and profession,” However, losses from the head “house property” and “unabsorbed depreciation” can be carried forward even in case of a belated return.
- Some of the deductions are also disallowed which include deductions, under sections 10A, 10B, 80-IA, 80-IB, 80-IC, 80-ID, and 80-IE.
- Furthermore, the taxpayer can lose interest on the refund under section 244A, if eligible, if the delay happens due to the late filing of the taxpayer.
- One cannot choose a new tax regime when filing a late return. The tax regime cannot be changed in a belated return. If you have salary income and have already filed an ITR before 31st July, AY, you can change the regime by filing a revised return.
If a person still fails to file his or her belated return, the income tax department may send them a notice to file the return.
Yes. From FY 2016-17 (AY 2017-18) onwards Belated Return can be revised. Belated Returns of earlier years can not be revised.
Yes, ITR can be filed after the due date. But it will be considered a Belated Return and late filing fees will be levied.
Yes. A taxpayer needs to e-verify the Belated Return filed after the due date. It will not be processed by the IT Department unless it is e-verified.
Yes, you can claim a refund of TDS deducted while filing a belated return u/s 139(4). The refund will be credited directly to your bank account mentioned in ITR. Make sure to pre-validate your bank account for the easy processing of a refund.