What happens if ITR is not filed by March 31?

“Delayed returns can be seen as the last opportunity to file ITR voluntarily. If you miss the due date to file late return, you lose your opportunity to file voluntarily ITR And can file it only in case of investigation initiated by the tax department,” said Neeraj Agarwal, partner, Nangia Andersen LLP.

Purva Prakash, Partner, Deloitte India, explained that investigations after a delayed deadline may come to you under sections 142(1) or 148. “The notice under 142(1) is a simple show cause notice sent by an Assessing Officer (AO) when he wants the taxpayer to file his ITR,” he said. It is generally applicable to taxpayers whose income is less than the minimum taxable income limit but are liable to file ITR as they may have foreign assets or refund to claim. “Notice under section 148 is issued when the AO is of the view that the income has escaped assessment (as ITR has not been filed). In this case, penalty may be imposed at 50% or Can go up to 200% of the total tax payable,” Prakash said.

Interest of 1% per month on outstanding tax under section 234A starts when a taxpayer does not file ITR by the due date. for the above arrears of tax 1 lakh, 234A commenced after the original due date of 31st July 2021. “Even if the taxpayer has paid arrears of tax in the form of self-assessment tax or advance tax, but has not filed return of income, interest will accrue under 234A till the time the ITR is filed,” said Prakash . It will continue to accrue even after March 31 unless you file the deferred ITR after receiving the show cause notice from the IT department.

Prakash said the authorities can also initiate prosecution proceedings if there is no sufficient reason for such non-compliance. “Prosecution under section 276CC can be initiated with rigorous imprisonment of a minimum period of 3 months to two years as well as fine, depending on the amount of tax evaded by the taxpayer,” Agarwal said.