Skip to main content

The cost of Filing Belated Tax Returns

Returns for income earned till FY12- 13 can be filed till March 31. But you might have to cough up a penalty and pay interest on the tax liability

July 31 is typically the last date for filing returns. However, those who missed this deadline can file their returns by March 31. Belated returns can be filed on or before two years from the end of the relevant tax year. So, even those who missed filing their returns for income earned in FY12- 13 or assessment year 2013- 14 can do so by March 31, 2015. However, no belated returns can be filed for years prior to assessment year 2013- 14.

While the I- T department allows taxpayers to file belated returns, assessees need to be aware of a few limitations in doing so.

Limitations

If any error is found in the return filed for assessment year 2013- 14, these can be revised only up to March 31, 2015. It is advisable to take the help of a chartered accountant or tax return preparer to file late returns. Don't forget to include income from bank fixed deposits, income from royalty, winnings from lotteries and any sum or gift exceeding 50,000 received from a non- relative, which is not on the occasion of marriage or under a will or inheritance.

Once a belated return is filed by an individual, this is final and cannot be amended in the future. So, one needs to be absolutely certain on the income being disclosed, deductions/ exemptions being claimed and tax credits/ reliefs being claimed.

Taxpayers should avoid some common mistakes while filing belated returns. This could be offering bank or fixed deposit interest on an estimated basis instead of the actual basis or not matching Tax Deducted at Source ( TDS) credits claimed in the return of income with that reflected in Form 26AS. Or forget to club income of a minor child or spouse from assets transferred by the transferor spouse.

Those who haven't filed returns for either assessment year 2014- 15 or 2013- 14 can't carry forward their capital losses to the next year. Usually, capital losses can be carried forward for eight assessment years and set off against capital gains. Short- term loss may be adjusted either against short- term gains or taxable long- term gains, while long- term loss can be adjusted against taxable long- term gains.

Assume you had made losses of 10,000 on sale of stocks in assessment year 2014- 15. In normal circumstances, you would have been allowed to carry forward the capital losses, either short- term or long term in nature, till assessment year 2022- 23. This won't be allowed now, since you'd missed the July 31 deadline for filing returns.

Those who file belated returns may also be denied refunds. If refund of any income tax is due to the tax payer, the revenue authority may deny the interest for the period of delay. Refunds for those filing returns before the due date take at least six months to reach the assessee, according to experts.

Penalties, charges

A penalty of 5,000 may have to be paid by those who haven't filed returns for assessment year 2013- 14. However, the choice of levying this is with the assessing officer.

If there are taxes payable, interest is payable on the tax liability at the rate of one per cent per month up to the date of payment of such taxes. However, no interest is payable if no tax is due. For most salaried employees, the tax due would be nil or negligible because employers would have deducted the applicable tax by way of TDS.

Advance Taxes

For individual tax payers, advance tax is due in case the tax liability is more than 10,000 after accounting for TDS. Additional interest will have to be paid if the deadlines for advance tax ( of 30 per cent by September 15, of 60 per cent by December 15 and 100 per cent by March 15) have not been met. The interest charged will be one per cent per month for three months after the first deadline and another one per cent on the cumulative tax due for three months after the second deadline. If you miss the March 15 deadline, you have to pay one per cent interest on the entire defaulted amount for every month until the tax is fully paid.

Section 276CC

Not filing tax returns on time can land you in jail. This can happen if the I- T authorities feel the assessee wilfully failed to furnish returns on time and the tax due is more than 3,000. Under section 276CC of the I- T Act, if the amount of tax exceeds 25 lakh, the assessee can be sentenced to rigorous imprisonment for anywhere between six months to seven years, and fined. In other cases, imprisonment can be between three months and three years, with fine.

|It is advisable to take the help of a CA or tax return preparer to file late returns |Belated returns cannot be revised |Those filing belated returns can't carry forward capital losses to the next year |Penalty of 5,000 possible if filing returns for assessment year 2013- 14 |Interest on tax liability at one per cent per month up to the date of payment of such taxes |Those filing belated returns may be denied refunds |Wilful defaults on tax payment can land you in jail

Best Tax Saver Mutual Funds or ELSS Mutual Funds for 2015

1.ICICI Prudential Tax Plan

2.Reliance Tax Saver (ELSS) Fund

3.HDFC TaxSaver

4.DSP BlackRock Tax Saver Fund

5.Religare Tax Plan

6.Franklin India TaxShield

7.Canara Robeco Equity Tax Saver

8.IDFC Tax Advantage (ELSS) Fund

9.Axis Tax Saver Fund

10.BNP Paribas Long Term Equity Fund

You can invest Rs 1,50,000 and Save Tax under Section 80C by investing in Mutual Funds

Invest in Tax Saver Mutual Funds Online -

Invest Online

Download Application Forms

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

---------------------------------------------

Leave your comment with mail ID and we will answer them

OR

You can write to us at

PrajnaCapital [at] Gmail [dot] Com

OR

Leave a missed Call on 94 8300 8300

---------------------------------------------

Invest Mutual Funds Online

Invest Any Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Popular posts from this blog

What is Electronic Clearing Service (ECS)?

  As the name suggests, it's an electronic process through which money can be transferred from one bank account to another. According to RBI, this mode is usually used for regular payments and receipts, like distribution of dividend, interest, salary, pension etc. This mode is also used for collection of bills for telephone, electricity, water, various types of taxes, payment of EMIs , investments in mutual funds , payment of insurance premium etc. There are two types of ECS , like most other banking transactions, ECS credit and ECS debit. An ECS credit is used by a bank account holder , usually a large company or an institution for services like payment of dividend, in terest, salary, pension etc. If your mutual fund pays you dividend to your bank account, of all probability it is being paid through ECS credit.ECS debit, on the other hand, is used when a company or an institution is getting money from a large number of people. For example if you are investing in a mutual fund sc...

WEALTH TAX

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300 WEALTH TAX   WHAT CONSTITUTES WEALTH? For wealth tax purposes, "wealth" means property , urban land, car, jewellery , yacht, boat, aircraft and cash in hand in excess of Rs 50,000. CAUTION POINT | Do not think you will have an easy escape from wealth tax by transferring your `wealth' without consideration to your spouse or minor child. Such assets will also be considered as your wealth. HOW TO DETERMINE YOUR TAXABLE WEALTH Add the taxable value of the above assets (computed as per the detailed rules for valuation) owned by you as on March 31 (for FY 2014-15, it will be March 31, 2015). In case you sold your car during the year, it will not be taxable wealth. Deduct loans if any obtained by you to acquire any of the taxable assets from the value of gross tax out for at least 300 days in a...

Equity Savings Fund

Invest Equity Savings Fund Online   The best part about these funds is that they are subject to equity fund taxation and at the same time are structured like MIP like funds . This new category, equity savings funds , offer a little of everything. They allocate money to equities & equity related instruments, and fixed income. They aim to generate returns by diversification. Such funds invest in fixed income and arbitrage to protect the investors from short term volatility and equity for capital gains. The best part of these funds is that they are subject to equity fund taxation and at the same time are structured like MIP funds.   MIP funds however are subject to debt fund taxation. Investors Equity savings funds are suitable for the following: First time investors who seek partial exposure to equity with less volatility and greater stability Investors seeking moderate capital appreciation with relatively lower risk Those wh...

How to Pick Top Performing Mutual Fund Schemes

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   How to Pick Performing Schemes  Funds that continue to stay in the top grade of performance over longer periods are the ones to bet on, advise investment experts   The mutual fund performance charts of the past few months make for an impressive reading. Funds across all categories boast of stellar returns. Sample this: The mid and small cap category has averaged 77 percent return over the past 12 months, with the best fund delivering a staggering 120 percent. The tax-saving funds also average an impressive 51 percent, including a fund which has soared 92 percent. Many of the table-toppers are funds of proven quality and track record. However, there are also schemes that are not that well-known. Some of these have rarely made it to the performance charts in the past, yet, of late, they bo...

8% Government of India Bonds quick guide

For those seeking comfort in safety of returns, the Government of India issued 8% savings bond once again comes to the fore. First launched in 2003, these bonds are issued by the government with a maturity of 6 years. The bonds are available at all times with specified distributors through whom you can apply to invest in them. Here is a quick guide to what the bond offers and its features to ascertain to check for suitability. What are Government of India bonds Government of India bonds are like any other government bonds with specified rate of interest. The rate is fixed at 8% per annum paid half yearly, or you can opt for cumulative payment of interest at the end of the tenure. You can buy these bonds from State Bank of India and its associates, other nationalized banks and some private sector banks such as HDFC Bank Ltd and ICICI Bank Ltd, among others. The bonds can be bought from the offices of Stock Holding Corporation of India as well. They are available in physical form onl...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now