Belated Return

Better Late then Never

It is the statutory obligation of every person to furnish a return of taxable income, where the total income in any relevant financial year exceeds the maximum amount which is not chargeable to income tax. The return of income must be furnished by the assessee in the prescribed manner from time to time. Where a person has not submitted his return of income, within the due dates mentioned under the Income tax Act, he can still file the return of income. Such a return is called ‘Belated/Late return.’ Be watchful as the clock is ticking and 31^st March is nearing.

   If you have missed the bus and have not filed the return on time, do not despair. 

Any person who has not filed the return within the time allowed may file a belated return at any time within one year from the end of the relevant assessment year or before the completion of the assessment, which ever is earlier. In the following cases belated returns can be filed, till 31^st March 2008 & onwards.

For instance, if an individual, who has only salary income, has not filed his return of income for the financial year 2005-06 (assessment year 2006-07) by July 31, 2006 and if no assessment proceedings are going on, he may file a belated return by March 31, 2008.

Consequences for late filing of return

• Interest is payable on the unpaid amount of tax.
• Penalty of Rs.5,000 shall be levied, in case the assessee files the belated return after one year from the end of the financial year.
• In case of return of loss, submitted after the due date, a few losses like business loss, speculation loss, capital loss & loss from the activity of owning & maintaining race horses cannot be carried forward for future set off.
• A belated return cannot be revised.
• In certain cases, you may even be liable for prosecution for not having filed returns with the intention of willfully avoiding tax payments.

So bag the opportunity, as you still have time, in case you have missed the bus of filing the tax return. This will surely ensure that you exit the Income tax Department with a smile, as is rightfully written at the tax department – “File, Smile & Go”. Better late than never is the best policy when it comes to income tax.

  CA Manasi Modi.

 For Nanubhai Desai & Co.