Individual assessees were required to file their income tax returns on or before 31st July, 2014. While most of the assessees would have filed the return, yet there may be many who could not file their returns by the due date for any reason – being on vacation, on official tour, for want of preparedness or even as a habit. Well, the last date is over but you have reasons not to worry on this account and be just cool. One can still file income tax return without any penalty and still be compliant if return is filed upto 31stMarch, 2015. So cheer up ! as you still have enough time about eight months to file you returns. This is contrary to perception of many persons that once delayed, return cannot be filed or that it will attract penalty.
While there is no penalty on return filed after 31st July but before 31st March 2015, yet there are some implications. If the returns are filed after 31st July, it should be ensured that return is error free as one looses the privilege to revise the return and rectifications are not possible. It would be advisable to collect all papers including TDS (Tax deducted at source) certificates so that return could be filed smoothly. This would also ensure that all details pertaining to filing of return are verified and return is filed correctly.
Sometimes, though late, it might not be wise to wait till 31st March to file return and it may make sense to file return as early as possible. This is so because if any income tax is payable, it would attract interest of one percent per month for every month of delay on the tax due. Not only this, you will have to forego the benefit of carrying forward the losses and setting them off in future years, if in case you have to return business losses or loss from capital gain. In some cases, it may be a big loss. In case one has a refund due from the Department, filing late return would also mean late processing of refund, besides losing interest on such tax refund.
However, if you have already paid all your taxes or tax dues but failed to file returns by 31st July, there is no reason to panic or worry because there is no interest or penalty. Yes, if you delay beyond 31st March, 2015, there could be a penalty of Rs. 5000 at the discretion of assessing officer. The penalty may be waived if reasonable cause which prevented from filing return is explained.
All said and done, returns should be filed, sooner the better. However, rule of ‘better late than never’ must be followed.