ITR filing: You can still face fine of ₹5,000 even if income tax return filed on time

Nearly 15 days have passed since the last due date to file income tax returns (ITR) for the financial year 2021-22, and assessment year 2022-23. About 5.83 crore ITRs have been filed till July 31 which was the deadline for the mentioned assessment year. However, there are chances that even if you have filed your ITR on time, you might still face a fine of ₹5,000. If you have failed to verify your ITR despite filing it within the specified timeline, your returns will be rejected and hence will lead to a late filing penalty.

The Income Tax Department has been guiding taxpayers to always verify their ITRs once filed, which is the final process for the completion of the filing of the returns.

On its website, the Income Tax Department says, "You need to verify your Income Tax Returns to complete the return filing process. Without verification within the stipulated time, an ITR is treated as invalid. e-Verification is the most convenient and instant way to verify your ITR."

The IT department further has guided that, "if you do not verify in time, your return is treated as not filed and it will attract all the consequences of not filing ITR under the Income Tax Act, 1961."

According to the department, however, you may request condonation of delay in verification by giving an appropriate reason. Only after submission of such a request, you will be able to e-Verify your return. However, the return will be treated as valid only once the condonation request has been approved by the competent Income Tax Authority.

Simply put, the time taken for verifying your ITRs after July 31, will make you fall under the penalty category.

The department suggests filing "a condonation request as soon as you notice that you have not verified your return."

From August 1, 2022, the CBDT has reduced the time limit for electronically verifying ITRs to 30 days from their previous 120 days. Also, the date when a taxpayer will e-verify their ITR -- will be considered as the date for filing of ITR. However, this e-verification is applicable to taxpayers filing the ITR-V form.

On July 29, in a statement, CBDT said, "It has been decided that in respect of any electronic transmission of return data on or after the date this Notification comes into effect, the time-limit for e-verification or submission of ITR-V shall now be 30 days from the date of transmitting/uploading the data of return of income electronically." This has come into effect from August 1.

Notably, after the due date of July 31, a late filing fee will be applicable to taxpayers under section 234F of the IT Act. Under this section, a 5,000 penalty is levied if the returns are furnished on or before December 31st of the assessment year. While the penalty will be ₹10,000 in any other case. However, if the total income of the person does not exceed ₹5 lakh - then the fee payable under this section shall not exceed ₹1,000.

At present, there are seven ITR forms available to be filed, however, these forms vary depending upon the category of taxpayers and their source of income. These forms are ITR-1, ITR-2, ITR-3, ITR-4, ITR-5, ITR-6, and ITR-7.

You can e-verify your ITRs through:

- OTP on the mobile number registered with Aadhaar, or

- EVC generated through your pre-validated bank account, or

- EVC generated through your pre-validated Demat account, or

- EVC through ATM (offline method), or

- Net Banking, or

- Digital Signature Certificate (DSC).

To know if your e-verification is completed, you will receive a success message along with your transaction ID. Also, an email will be sent to your registered email ID with the e-filing portal.

On August 1, the Finance Ministry said, that the surge of filing ITRs peaked on 31st July 2022 (due date for salaried taxpayers and other non-tax audit cases) with over 72.42 lakh ITRs being filed on a single day i.e on 31st July 2022. The total ITRs filed till 31st July 2022 for AY 22-23 is about 5.83 crore.