While the income-tax (I-T) department allows you to file your returns even after the 31 July deadline expires—you can file till 31 March 2012—it doesn’t allow certain other things you can normally do if you are within the deadline. With the last date only about a fortnight away, here’s why you should hurry up.
Can’t revise returns
Just in case you made an error while filing returns, you will not be able to do so. Says Sudhir Kaushik, co-founder and chief finance officer, Taxspanner.com, a tax portal, “If you miss the deadline, you will not be able to revise your returns. But if you file your returns by this deadline and later realize that you need to revise your returns, you get time till two years from the end of financial year or assessment year, whichever is earlier.”
Can’t carry forward losses
I-T rules permit you to carry forward losses, such as loss incurred in your investment activity, to the next assessment year. But miss the deadline and you won’t be able to do so. Says Anil Rego, CEO, Right Horizons, an investment advisory and wealth management firm, “If you’ve incurred some losses from investing in shares or mutual funds, you can carry forward the losses for the next eight years, but if you fail to file your returns by this deadline, you cannot carry forward losses.”
Here are two cases where you will have to shell out interest if you miss the deadline.
Income-tax due: If you had tax dues in the current assessment year and you failed to file your returns on time, be prepared to pay an interest. “You will be liable for penal interest under section 234A at 1% per month on the amount of tax due from the due date of filing returns,” says Rego.
Advance tax: You need to pay advance tax on three specific dates every fiscal year— that is 30% of total tax before 15 September, 60% before 15 December and 100% by 15 March. Says Kaushik, “In case taxes paid before 15 March is less than 90% of total tax then 1% per month penal interest needs to be paid under section 234B from 1 April on the amount less paid (balance amount) at the time of filing returns. Interest for the deferment of advance tax also attracts 1% penalty.” For example, if the total tax payable for the year is Rs 1 lakh and you have paid Rs 20,000 before 15 September and Rs 60,000 before 15 December and Rs 10,000 before March 15, then 1% per month will be payable on the balance Rs 10,000 for three months under section 234C. Says Kaushik, “If you file your return after 31 July and there is some tax payable then additional interest of 1% per month needs to be paid from 1 August to the date of filing.”
What if you miss 31 March deadline too
If you do so, you may have to pay a one-time penalty. Balwant Jain, chief finance officer, Apnapaisa.com, says, “If you miss the 31 March deadline, too, you may have to pay a penalty of Rs 5,000 and the return can be filed by 31 March 2013.”
So you better get going while there is still time.