ITR Filing Update: For the fiscal year 2021–2022 or assessment year 2022–2023, income tax returns (ITRs) must be filed by July 31st, 2022. It’s fine if you have already submitted the return or if you are able to do so before the deadline.
If you miss the July 31 deadline, you still have until December 31, 2022, to file the return. However, there will be a late fee. There will be further financial repercussions as well.
For taxpayers with a yearly income up to Rs 5 lakh, there is a Rs 1,000 late fine. The late fee is Rs 5,000 if your yearly income exceeds Rs 5 lakh.
However, you won’t be required to pay a late filing penalty if your gross total income is less than the basic exemption amount.
The basic exemption threshold is determined by the income tax system you select. For taxpayers under 60, the basic tax exemption ceiling under the previous income tax system is Rs 2.5 lakh. The basic exemption threshold for those aged 60 to 80 is set at Rs 3 lakh. The exemption threshold for those over 80 is set at Rs 5 lakh.
The baseline tax exemption ceiling is Rs 2.5 lakh under the new concessional income tax regime, regardless of the taxpayers’ age.
Gross total income is the amount of income before any deductions allowed by sections 80C through 80U of the Income Tax Act.
This ITR Filing Update can be considered as the biggest update because Missing deadlines have several consequences in addition to the late fees. You will have to pay interest on the late tax payment if you miss the deadline.
“While filing an ITR, there may be some tax due on things like interest and dividends. TDS deducted at 10%, but you are in the 20% or 30% tax bracket, then the difference in tax must be paid with interest in accordance with Section 234A at a rate of 1% per month “declaring Sudhir Kaushik, CEO and Co-Founder of TaxSpanner.
You can just deposit the unpaid tax if you file the return before the deadline. However, if you miss the deadline, you will be compelled to retroactively deposit the unpaid tax and interest as of July 31. The interest for the entire month must be paid at a rate of 1% per month if the unpaid balance is paid after the fifth day of any given month.
By adjusting losses from commercial activities or the sale of property against other incomes, a taxpayer can lower their responsibility. The ITR must be submitted prior to the deadline in order for the losses to be carried forward.
“If the due date is missed, you are not permitted to carry forward any losses (except than losses from personal property). Losses on sales of real estate, stock, and other capital assets that were compelled to be sold during the Corona should be reported and lodged prior to the deadline “declaring Sudhir Kaushik, CEO and Co-Founder of TaxSpanner.
According to the Income Tax Act, company losses (apart from speculative losses) may be offset against any head of income, with the exception of salary income.
Any unadjusted loss may be carried forward for a maximum of eight fiscal years following the current fiscal year and offset against any permitted business revenue. For instance, business losses from the fiscal years 2020–21 can be offset by revenue from the fiscal years 2021–22.
Kaushik commented on the potential for a warning from the Income Tax Department “As we can see from the ITR and AIS filings, many people bought in stock during the Covid epidemic (annual information statement). As a result, tax notices for discrepancies in claimed income or loss are also possible.”
In the event that you miss the July 31 deadline, the deadline for submitting a late income tax return for the fiscal year 2021–2022 is December 31, 2022.
You must file an appeal for forgiveness with the commissioner of income tax of your ward for refunds and losses carried over if you miss even the deadline of December 31, 2022, for refunds and losses. Kaushik advised, “If the justification is legitimate, you might be granted permission.
When you owe taxes, there is a severe penalty. “You have to pay 50% additional tax of this pending tax amount if filing updated return within a year and 100% additional tax if filing after one but before two years,” he said. “If you find additional income in AIS or other documents which were not declared in original return or not filed at all.”
This ITR Filing Update can be considered as the biggest update because if you submit your revised return after the 31st of December but before that date has passed, you must use a new form, ITR U, and explain why your income has changed.
The following are some possible causes: previously unfiled returns; income that was not reported accurately; incorrectly selected heads of income; reduction of carried forward losses; reduction of unabsorbed depreciation; reduction of tax credits under Sections 115JB and 115JC; incorrect tax rate; and others.
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