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The Government has clearly said that it will take strict actions against those who failed to pay tax within the time. The statement may be nerving for those who have missed the deadline for filing taxes by July 31, 2014. But, here is another chance to correct the mistake, which comes at a price though. Those who missed the original deadline could file their returns by March 31, 2015. However, the deadline comes with certain attached conditions, which are as follows.
Penalty & interest - For those who have already paid the taxes but have not filed the returns; there would be no penalty or interest. But, if an individual again miss the deadline of March 31, 2015 then he is liable to pay a penalty of Rs. 5,000, which depends on the discretion of the tax officer. On the other hand, if taxes are unpaid for the financial year 2013-14, then an individual needs to pay a penal interest of 1% per month applicable on the income tax amount due. The interest has to be paid for every month since April 2014.
Advance tax: As per the current rules, advance tax of 30% is to be paid by September, 60% by December and 100% by March 15. If an individual defaults to pay tax or pay less than the compulsory percentage then he is charged, with penal interest. An individual has to pay a simple interest of 1% per month for a period of three months on subsequent deadline for advanced tax payment.
No carry forward of losses: A person who has missed the July 3, 2014 deadline has to forego the benefit of ‘Carry forward of Losses.’ If returns are filed by July 31, 2014 then a person has the option to carry forward capital loss for a period of eight years, but the same benefit is not available to those filing late returns.
Late tax refunds: Late income tax filing means late refund from the income tax department and there are fewer chances that such delayed refunds would earn any meaningful interest. However, if the returns are filed early then the refunds are processed faster and in case of delay, an assessee gets chance to earn interest, which becomes due from the time returns are filed.
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