The due date for filing income tax returns for the financial year 2021-22 (assessment year 2022-23) – July 31 – is nearly here.
If you have not completed this annual exercise already, you have no time to lose. You will have to commence the process right away, but before that you must understand why it is necessary to file returns, and equally importantly, complete the exercise on time.
While the window until December 31, 2022 is available for later-filers, it comes at a steep cost – penalty of Rs 5,000, which is restricted to Rs 1,000 if your total income is less than Rs 5 lakh.
To know more about the importance of filing returns and consequences of delaying the process beyond July 31, Moneycontrol’s Preeti Kulkarni spoke to Preeti Khurana, Director, Advocacy and Regulation, Clear.in.
Here are edited excerpts:
“Filing income tax returns is mandatory for individual tax-payers if their total annual income in that financial year exceeds Rs 2.5 lakh.”“Do note that this is your gross total income, before factoring in deductions under section 80C, 80D and so on.”
“It is also compulsory if you have to tax refund to claim or capital losses to carry forward.”
“Also, if you are resident in India but have bank accounts, other assets and income in foreign countries, again, you must file returns.”
“Filing income tax returns is the only way to claim refund on excess taxes deducted.”
“You should skip filing returns as the government has a lot of financial data about you through Form 26AS and Annual Information Statement.”
“You could get a notice on the basis of TDS and other financial transactions recorded in these statements.”
“The onus of filing returns is on tax-payers – there is no way of avoiding it. The biggest reason to complete the process is compliance – to be on the right side of law.”
“Income tax laws now include a new section where TDS rates are higher for those who do not file returns despite being required by law to do so.”“July 31 is the due date for filing returns for financial year 2021-22 – if you miss this deadline, you have some extra time until December, but will end up paying late-filing fees of Rs 5000 (Rs 1,000 if your income is less than Rs 1,000.”