Section 234F of the Income Tax Act imposes a late filing fee on income tax returns that are filed after the deadline. For individual taxpayers, the deadline to submit your IncomeTax Return  for the AY 2022-23 (FY 2021–22) is July 31, 2022 and belated return last date is  December 31, 2022. A penalty may result from not submitting your ITR on time, but there are other impacts and inconveniences as well. Let's examine these in more detail below.

Section 234F

A belated return, as the name suggests, is one that is submitted after the deadline set forth in the income tax regulations. According to Section 139(1) of the Income-tax Act ("the Act"), an assessee (other than a company) whose accounts are not required to be audited by a chartered accountant is required to furnish a return of his income on or before July 31 of the applicable Assessment year. The penalty amount under Section 234F, its applicability, and more are all provided below.

The ITR filing deadline for the assessment year 2022–2023

According to section 139(1), the deadline for filing returns for the Assessment Year 2022–23 is July 31, 2022, unless the government extends the deadline.

The common misconception among taxpayers is that once their taxes are paid, they are free from further responsibility. Legal repercussions, however, can result from failing to file an ITR by the deadline. For returns submitted after the deadline, a late filing fee is charged.

Penalties For Filing Income Tax Returns Late

Failure to file your ITR by the deadline may result in a penalty or late filing fees, in addition to the inconveniences associated with the delay. Section 234F discusses late filing fees and the circumstances under which they apply. We have covered every aspect of the applicability of section 234F under the Income Tax Act of 1961 in this guide. To avoid being subjected to the Section 234F penalty, read carefully.

For example, the deadline for filing returns for financial year 2021-22 is July 31, 2022. If you fail to file your ITR by the due date, you can file a belated return by December 31, 2022. However, you must pay the penalty for late filing.

If you file your ITR after the due date of July 31, 2022 but before December 31, 2022, you will face a maximum penalty of Rs 5,000.

However, small taxpayers are protected: if their total income does not exceed Rs 5 lakh, the maximum penalty for late payment is Rs 1000.

Impact of Missing the Due Date for Filing

Interest on late filing

Aside from the penalty for late filing, interest at 1% per month or part thereof on tax due will be charged under Section 234A until taxes are paid.

It is critical to note that you cannot file an ITR unless you have paid your taxes. The interest calculation under this section will begin on the day following the due date,  so the longer you wait, the more you will pay.

Refunds Are Delayed

If you have overpaid taxes or deducted TDS  are entitled to a refund from the government, you must file your returns by the deadline in order to get your money as soon as possible.

Penalty

A penalty of up to 50% of the tax due may also be assessed by the income tax officer in cases where income is underreported.

A taxpayer may experience additional repercussions for filing returns late in addition to the penalty assessed by the IT Department.

Losses not being stimulated

Losses incurred (aside from losses to real estate owned by the taxpayer) may not be carried over to succeeding years. If the return has not been filed by the due date, you cannot use these losses as an offset against future gains. Losses may, however, be carried forward if they relate to house property.

Prosecution

If a person purposely fails to file a return despite receiving notices, the income tax officer may initiate prosecution proceedings. The sentence can range from three months to two years in prison, plus a fine.

If you owe more money to the Income Tax Department, the prosecution period may be extended to seven years.

Conclusion

The Income Tax (I-T) Act, Section 234F, imposes a late filing fee on income tax returns filed after the deadline. Individual taxpayers' ITR submission deadline for AY 2022-23 (FY 2021-22) has been extended to December 31, 2022. Not submitting your Income Tax Return on time may result in a penalty, but there are other consequences and inconveniences. This article will show you everything you need to know about filing a late income tax return.