In a major relief to taxpayers, the Central Board of Direct Taxes (CBDT) has extended the deadline for filing income tax returns (ITR) for FY20 (assessment year 2020-21) to December 31, 2020. The deadline for those who are required to get their ITR audited has been extended to January 31, 2021 from October 31, 2020.
Delay in filing the income tax returns will have its consequences. Many tax benefits will be taken away from the taxpayer along with penalties, so it is very important to file income tax returns on or before the due dates. Filing belated return should be avoided by the taxpayers.
Also Read: ITR filing due date for AY20-21 extended
What is the penalty for late filing of income tax return?
- Penalties: Under section 234A for the delay in filing the return of income, the taxpayer has to pay simple interest at 1 percent per month or part of a month.
A late filing penalty of Rs 10,000 is payable if the return is filed later than December 31.
A late filing fee of Rs 5,000 is charged, if the ITR return is filed after the due date but before December 31st of the assessment year.
However, if total income does not exceed Rs 5 lakh, then the amount of late filing fees to be paid cannot exceed Rs 1,000.
Also Read: Key dates to remember for 2020 ITR filing
Taxation benefits: A taxpayer will have to let go of some exemptions and deductions for that year along with a penalty. If ITR is filed late, the exemptions and deductions which will not be available are:
- Exemptions to the new establishments are not available under section 10A, section 10B.
- In respect of profits and gains from industrial undertakings or enterprises engaged in infrastructure development deduction are not available under 80-IA, 80-IAB, 80-IB, 80-IC, 80-ID and 80-IE.- Under 80IAC, 80IBA, 80JJA, 80JJAA, 80LA, 80P, 80PA, 80QQB and 80RRB deduction are not available.