India Extends Deadline to File Revised and Belated ITR

The Indian government has recently announced an extension for taxpayers to file their revised and belated Income Tax Returns (ITR) for the Assessment Year 2024-25. The new deadline is January 15, 2025, offering taxpayers extra time to complete their filings without facing penalties. This decision by the Central Board of Direct Taxes (CBDT) not only relieves taxpayers from the stress of meeting the original deadline but also provides accountants and businesses with a more manageable timeline to assist their clients and employees in the filing process, respectively. The extension also addresses various delays and issues that have affected the tax filing process, providing a more streamlined and efficient experience for all parties involved.

Understanding the Revised and Belated ITR

Before diving into the implications of the extension, it’s essential to understand the difference between belated and revised ITRs:

• Belated ITR: This return is filed by taxpayers who miss the original deadline for filing their income tax returns, which typically falls on July 31. Filing a belated ITR allows individuals to report their income still and pay any taxes owed, though it may attract a late fee.
• Revised ITR: A revised return is filed when there are mistakes or omissions in the original ITR. If taxpayers realize they’ve made an error or forgotten to mention some income, they can file a revised return to correct the information. This ensures that the taxpayer’s records are accurate and up-to-date. To file a revised ITR, taxpayers need to log into the income tax portal, select the option for revised filing, and make the necessary corrections. Once the form is filled, it needs to be verified and submitted, similar to the process of filing an original ITR.

The Importance of Filing ITR on Time

Filing the ITR on time is a crucial responsibility that helps individuals and businesses avoid penalties and late fees. However, for various reasons, taxpayers sometimes miss the deadline. Filing a belated ITR allows them to meet their tax obligations still while paying a late fee. A revised ITR is crucial when errors are identified in the original submission. This system helps ensure taxpayers comply with the tax laws, even if mistakes occur.

Key Changes Due to the Extension

The new deadline of January 15, 2025, was set after considering the concerns raised by taxpayers and professionals. Several reasons contributed to this extension:

1. Technical Issues with the ITR Utility: Many taxpayers this year faced the difficulty of claiming exemptions under Section 87A. This provision provides tax rebates to individuals whose income is less than ₹5 lakh. The software’s technical glitches made it difficult for some individuals to file their returns correctly.
2. Increased Volume of Tax Filings: The number of taxpayers filing returns surged, especially during the last few days before the original deadline, causing congestion in the income tax portal. This led to delays and inconvenience for individuals and businesses.
3. Taxpayer Requests: Tax professionals and taxpayers have been requesting an extension due to unforeseen issues like delayed information from employers, which can affect the filing process. The CBDT has recognized these concerns and granted the extension to ease the burden on individuals who could not file their ITR on time.

Belated and Revised ITR: Key Points to Keep in Mind

1. Late Filing Fee: Taxpayers who file their returns after the original deadline must pay a late filing fee. If the total income is below ₹5 lakh, the cost is ₹1,000. For individuals with income above ₹5 lakh, the late filing fee rises to ₹5,000. These fees increase every year if the return is not filed on time.
2. Rebate under Section 87A: Individuals with taxable income up to ₹5 lakh are eligible for a rebate under Section 87A, which reduces their total tax liability. The technical issues that delayed this benefit have now been addressed, allowing more individuals to file their returns correctly.
3. Interest on Late Payment: If tax due is not paid on time, taxpayers may be charged interest under sections 234A, 234B, and 234C. The revised return option allows taxpayers to correct errors and pay the due tax, reducing the chances of penalties due to late payment.
4. Accuracy in Filing: Filing a revised ITR allows taxpayers to correct any discrepancies in the original return. This ensures that no income is overlooked, deductions are claimed properly, and taxpayers do not face unnecessary scrutiny from tax authorities. It is crucial to double-check the information before submitting the revised return.
5. Section 234F Penalty: In addition to the late fees mentioned above, the tax authorities can impose a penalty under Section 234F for filing a belated return. However, the penalty amount is capped at ₹10,000 for taxpayers who miss the deadline for filing their returns. This penalty does not apply to taxpayers with income below ₹5 lakh.

How to File Belated or Revised ITR

For taxpayers who still need to file their belated or revised ITR, here is a step-by-step guide:

1. Visit the Income Tax Portal: Log into the official income tax portal (www.incometax.gov.in) and access your account.
2. Select the Correct Form: Choose the relevant ITR form based on your income sources. For individuals, ITR-1 or ITR-2 is commonly used. If you are revising an ITR, select the option for revised filing.
3. Fill in the Necessary Details: Ensure that all income, deductions, and exemptions are correctly filled out in the form. Include any additional income that might have been missed previously.
4. Verification: Once you have completed the form, verify the details and submit the return. You must authenticate your filing using one of the available verification methods, such as Aadhaar OTP, net banking, or a physical verification code.
5. Pay Taxes and Late Fees: If you owe taxes, ensure payment of both the taxes and the late fees to complete the filing process.

Conclusion

Extending the deadline to file revised and belated ITRs is a welcome development for taxpayers facing difficulties filing their returns before the original deadline. It provides additional time for individuals to rectify mistakes, claim benefits, and ensure compliance with tax laws without incurring penalties. Taxpayers are encouraged to file their returns as soon as possible, using the extended time wisely to avoid further complications. With the new deadline, taxpayers have a second chance to meet their obligations, ensuring they don’t miss out on available rebates and deductions.

For those who haven’t yet filed their returns, it’s an opportunity to address discrepancies, correct errors, and submit an accurate ITR. The government’s decision to extend the filing date clearly demonstrates its understanding of the issues faced by taxpayers and its steadfast commitment to supporting them through the process.