By Raju Vernekar
Mumbai, Dec 27:
The Income Tax Department has introduced a ‘Jhatpat Processing’ initiative to ease the income tax return filing experience for taxpayers and the last date to file income tax returns (ITR) for the financial year 2019-20 (the assessment year 2020-21) has been extended till December 31, 2020.
The Income Tax (I-T) Department took to Twitter to announce that it has launched the ‘Jhatpat Processing’ feature. The I-T Department said that the feature has already been started for ITR-1 and 4 forms and taxpayers can file their I-T returns for the assessment year 2020-21 by visiting the e-filing website — incometaxindiaefiling.gov.in.
The ‘Jhatpat processing’ feature will only be applicable to taxpayers whose ITRs are verified and bank accounts are pre-validated. Besides, there are no arrears or income discrepancy, or tax deducted at source (TDS) or challan mismatch.
The Central Board of Direct Taxed (CBDT) had extended the last date for filing ITR for FY 2019-20 (AY2020-21) to December 31 in view of the COVID-19 pandemic. The CBDT said the deadlines have been extended in order to “provide more time to taxpayers for furnishing of Income Tax Returns”.
Usually, taxpayers are supposed to file ITR by July 31 but an exception was made this year due to the pandemic. Earlier in May, the government had extended the deadline from July 31 to November 30, to give compliance relief to taxpayers. In October, it was further extended to December 31, 2020. For taxpayers whose accounts need to be audited, the ITR filing deadline has been extended for two more months till January 31, 2021.
Taxpayers can file ITR online through e-filing. An independent portal has been established by the I-T department for e-filing of income tax returns. Some private entities are also registered by the I-T Department which allow e-filing through their websites. The tax return is also necessary to claim a refund of any additional amount that might have been deducted at source (TDS) and deposited with the income-tax department.
If the return is filed after the deadline i.e. on or after January 1, 2021, then the assessee will have to pay a late fee of up to Rs 10,000. However, if the income is below taxable limit, then the assessee will not have to pay it even if the return is filed after the deadline.
An income taxpayer is liable to pay late ITR filing fees of: a) Rs 5,000 if tax return is filed after the deadline but on or before December 31 of the relevant assessment year (Not relevant for FY 2019-20 as the last date to file ITR for FY 2019-20 is December 31, 2020).
b) Rs 10,000 if tax return is filed after December 31 but before the end the relevant assessment year, i.e., before March 31 (in this case between 1 January 2021 and March 31, 2021). “If an individual files his/her ITR after the expiry of deadline (December 31, 2020) i.e. between January 1, 2021 and March 31, 2021, then late fee of Rs 10,000 will be levied.”
If the assessee is a small taxpayer whose total income does not exceed Rs 5 lakh then the maximum fees he/she is liable to pay is Rs 1,000 if the ITR is filed any time after the expiry of the deadline (i.e. December 31, 2020) but before March 31, 2021.
This law of levying late filing fees under section 234F was introduced in the Budget 2017 and became effective for financial year 2017-18 or assessment year 2018-19 onward. Assessment year is the year immediately following the financial year for which the ITR is filed. The assessment year for the financial year 2019-20 is 2020-21.
Who are not required to pay
However, tax experts are of the view that if a person whose gross total income does not exceed the basic exemption limit files a belated return, he/she will not be liable to pay late filing penalty. “There will be no late filing fees to be levied as mentioned under section 234F on the income tax return filed after the deadline if the gross total income does not exceed the basic exemption limit, said a Chartered Accountant.
At present, the basic exemption limit for resident individuals below the age of 60 years is Rs 2.5 lakh. For senior citizens aged 60 years and above but below 80 years, income up to Rs 3 lakh is exempted from tax. For super senior citizens i.e. of age 80 years and above, the basic exemption limit is up to Rs 5 lakh.
”Section 234F draws reference of persons liable to pay late filing fees for filing belated income tax return from Section 139 of the Income-tax Act. Section 139(1) of the Act states that the following persons have to mandatorily file ITR: (a) a company or a firm/LLP irrespective of quantum of income and (b) any other person only if his total income exceeds the maximum amount not chargeable to tax, i.e., basic exemption limit.”
Exception to above rule
However, amendments were made in the Income-tax Act, 1961 via Budget 2019 effective from financial year 2019-20 or assessment year 2020-21 onward, where it was made mandatory for a certain section of individuals to file the income tax return even if their gross total income does not exceed basic exemption limit. These include individuals:
a) who have deposited an amount or aggregate of the amounts exceeding Rs 1 crore in one or more current accounts maintained with a banking company or a co-operative bank; or b) who have incurred an expenditure of an amount or aggregate of the amounts exceeding Rs 2 lakh for himself or any other person for travel to a foreign country; or c) who have incurred expenditure of an amount or aggregate of the amounts exceeding Rs 1 lakh rupees towards consumption of electricity or d) who fulfil such other conditions as maybe prescribed.