Income Tax Act if your total income exceeds the basic exemption limit: You have
to file the Income Tax Return within the prescribed time, i.e. by the due date.
due dates of filing returns for Assessment Year 2015-16 are the following:
people fall in this category –
employees, pensioners and other persons whose accounts are not required to be
2015 (Extended Date)
and other persons whose accounts are to be audited
What happens if a person does not file the Income Tax
Return by the due date?
have to Pay Interest on Income Tax Due if you don’t file on time
you do not file the Income Tax Return by the due date:
are liable to pay interest at the rate of one percent for every month after the
due date till the date of filing the return.
No Tax is due: Interest is calculated on the amount of tax payable after
adjustment of pre-paid taxes like advance tax, TDS etc. So, if there is no tax
payable on the basis of the Income declared in the Tax Return, there is no
liability for the payment of interest.
You don’t get the benefit of Carry Forward of Losses
if you don’t file on time
income tax law, if you have sustained a Business loss or loss under the head
“Capital Gains”, you can carry forward the loss ONLY if you file the Income Tax
Return by the due date.
if you have sustained a loss, you must file your Income Tax Return in time if
you want to carry forward the loss for future adjustment with your Income.
Possibility of Penalty or Prosecution by the Income
you could not file the Income Tax Return by the due date: To avoid any penalty
by the Income Tax Department, you must file your Income Tax Return before the
end of the relevant assessment year that is 31st March 2016.
of Penalty and Prosecution: If you do not file your Income Tax Return by 31st
March 2016, the Income Tax Department may impose a penalty of Rs. 5000, even
though the tax payable by you may be Zero.
if a person has failed to file the Income Tax Return by 31st March 2016 and the
tax payable after adjustment of advance tax and TDS exceeds Rs. 3000, he may be
prosecuted for imprisonment also. However, this law is used in practice very
Other reasons for filing the returns of income within
a refund is due after adjustment of prepaid taxes, it is necessary to file the
Income Tax Return to get the refund from the Income Tax Department.
Loans: Further, the return is a declaration of your income and it will be
extremely helpful when you are applying for a loan from bank. Before granting
the loan, banks want to know your financial capacity and your income details as
shown by you in income tax returns.
of foreign countries: Many countries want to know if you are financially sound
before they issue you a visa and for this purpose they will rely on your income