Section 234F: Penalty for Late Filing of ITR

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By Hiral Vakil on February 18, 2020

In Budget 2017, the government inserted a new section under the income tax act to penalize late filers of a tax return. From FY 2017-18, in case of delay in filing of a tax return by an individual whose income exceeds basic exemption limit penalty is levied u/s 234F.

Penalty for late filing of ITR depends on the total income earned by a taxpayer during the year.

 

Total Income

Late Filing Fees

Up to Rs. 2,50,000

Nil

Rs. 2,50,000 to Rs. 5,00,000

Rs. 1,000

Above Rs.5,00,000 (Return is filed on or before 31st December of the assessment year)

Rs. 5,000

Above Rs. 5,00,000 (Return is filed after 31st December of the assessment year)

Rs. 10,000

Let’s take an example to understand it better:

Ajay is a salaried individual and he forgot to file his return for FY 2017-18. His total income for a year is Rs. 7,20,000. TDS on his salary income has been deducted by his employer. And he decided to file his return on 12th March 2019.

In this case, even though TDS has been deducted from his income. Ajay will be penalized with late filing fees of Rs. 10,000. Since his income is more than Rs. 5,00,000.

FAQs

1. Can we file the Income Tax Return (ITR) without paying the tax?

Income Tax Returns (ITRs) can be filed only if we have paid the tax due to the government. If you submit the ITR without paying then your Income Tax Return can be declared Defective.

2. What is Section 234F?

As per Section 234F of Income Tax Act, if a person is required to file Income Tax Return (ITR) as per the provisions of Income Tax Law [section 139(1)] but does not file it within the prescribed time limit then late fees have to be deposited by him while filing his ITR form.

3. What is the penalty for the late filing of ITR u/s 234F?

  • Taxpayers earning income between INR 2.5 Lakh to INR 5 Lakh will have to pay a fine of INR 1,000
  • Taxpayers earning income above INR 5 Lakh will have to pay a fine of INR 5,000 if the ITR is filed before December 31st of the Assessment Year
  • Taxpayers earning income above INR 5 Lakh will have to pay a fine of INR 10,000 if the ITR is filed after December 31st of the Assessment Year