ITR Filing Due Date Extension: Will the July 31 due date for filing tax returns be extended?

So far, close to four crore returns have been filed as on July 23, 2023.

After Revenue Secretary Sanjay Malhotra said last week that an extension of July 31, 2023 for filing income tax return for financial year 2022-23 was unlikely, there is every reason for tax-payers to rush to complete their exercise this week.

However, the income tax department and the finance ministry ought to consider extending the deadline for individual tax-payers and small businesses in flood-affected states such as Uttarakhand, Himachal Pradesh, Delhi and even parts of Gujarat, say chartered accountants.

Also read: ITR refund: Can you file a revised return after getting a refund?

Floods impact return-filing in affected states

“Many tax-payers in these states have faced genuine hardships due to the flood-like situation, which is quite grim. There is a case for exemption to these regions, as even the Internet services were affected, potentially delaying the return-filing process,” says Kuldip Kumar, Founder, Mainstay Tax Advisors.

So far, close to four crore returns have been filed as on July 23, 2023. Out of these over 2.12 crore returns have been verified and processed, as per the income tax department’s data.

“Most tax-payers and tax consultants will not need an extension. Out of our client base, close to 80 percent have shared their data, around 50-60 percent returns are already filed, while nearly 30 percent are in the pipeline. This would be the case across most tax professionals. Some will initiate the process only in the last week -there will always be those who come in only at the last minute,” says Mumbai-based chartered accountant Chirag Chauhan.

Unlike the last couple of years, tax consultants are encountering fewer glitches in the I-T return e-filing portal. “Portal is working smoothly this time, barring minor issues. Work over the next seven days is likely to be hassle-free,” he says.

Also read: Moneycontrol's complete income tax return-filing guide 

I-T return process needs further streamlining

Yet, the overall return-filing process ought to be more efficient to prevent delays and errors as chartered accountants get just about 45 days to complete the process, particularly for their salaried clients.

“Forms-16 are issued only around June 15. AIS-TIS (Annual Information Statement-Tax Information Summary) reconciliation has pushed up the time needed for verification. Many clients who would otherwise file returns on their own now come to us as they cannot afford to miss reporting incomes such as capital gains that show up in AIS. Since reporting capital gains is not straightforward, they approach us to file returns,” explains Chetan Chandak, Director, TaxBirbal, a tax consultancy firm.

Many tax-payers have also received tax notices this month and they are bound to approach tax chartered accountants for advice on responding to them. "Complexities and workload have gone up for chartered accountants and this does merit extension of the due date, though it is unlikely," he added.