The Income Tax Act, of 1961 is the primary legislation that governs the income tax system in India. Section 139(1) of the Act mandates that all taxpayers are required to file their income tax returns (ITR) within the prescribed due date, failing which they may be liable to pay penalties and interest. In this article, we will delve deeper into the various aspects of Section 139(1) and its implications for taxpayers.
Overview of Section 139(1):
Section 139(1) of the Income Tax Act 1961 requires every person who has income exceeding the basic exemption limit to file their income tax return (ITR) within the due date. The due date for filing ITR is usually 31st July of the assessment year (AY) for individuals and HUFs who are not subject to a tax audit. For taxpayers who are subject to a tax audit, the due date is 30th September of the assessment year.
Who is required to file ITR under Section 139(1)?
As per Section 139(1), any person whose total income exceeds the basic exemption limit is required to file their income tax return. The basic exemption limit for the financial year 2022-23 is Rs. 2.5 lakh for individuals below the age of 60 years, Rs. 3 lacks for senior citizens (aged 60 years or above but below 80 years), and Rs. 5 lacks for super senior citizens (aged 80 years or above).
Additionally, individuals who have incurred losses under various heads of income or who claim a refund of excess tax paid are also required to file their ITR.
Penalties for non-filing or late filing of ITR: If a taxpayer fails to file their ITR within the due date, they may be liable to pay a penalty of Rs. 5,000. If the ITR is filed after the due date but before 31st December of the assessment year, the penalty amount is reduced to Rs. 1,000. However, if the ITR is filed after 31st December of the assessment year, the penalty amount is increased to Rs. 10,000. In case the total income of the taxpayer does not exceed Rs. 5 lacks, the penalty amount shall not exceed Rs. 1,000.
In addition to the penalty, the taxpayer may also be liable to pay interest on the tax payable. The interest is charged at the rate of 1% per month or part of the month for the period of delay in filing the ITR.
Benefits of filing ITR:
Filing your income tax return has several benefits. Firstly, it helps you to comply with the legal requirements of the Income Tax Act. Secondly, it enables you to claim refunds of excess tax paid during the year. Thirdly, it serves as proof of income for various purposes such as obtaining loans, visas, and other financial transactions. Lastly, it helps you to maintain a clean tax record, which can be beneficial in case of any future tax-related issues.
Conclusion:
Section 139(1) of the Income Tax Act 1961 is an important provision that mandates the filing of income tax returns by taxpayers. Non-compliance with this provision can attract penalties and interest, which can have a significant impact on the taxpayer’s finances. Hence, taxpayers need to understand the provisions of Section 139(1) and comply with the requirements of the law. Filing your ITR not only helps you to comply with the legal requirements but also has several benefits, such as claiming refunds and maintaining a clean tax record.
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Frequently Asked Questions
Q: Who is required to file an income tax return under Section 139(1) of the Income Tax Act 1961?
A: Any person whose total income exceeds the basic exemption limit as per the income tax slab for the relevant financial year is required to file an income tax return under Section 139(1).
Q: What is the due date for filing an income tax return under Section 139(1)?
A: The due date for filing income tax returns for individuals and HUFs who are not subject to tax audits is usually 31st July of the assessment year (AY). For taxpayers who are subject to a tax audit, the due date is 30th September of the assessment year.
Q: What are the penalties for non-filing or late filing of income tax returns under Section 139(1)?
A: If a taxpayer fails to file their income tax return within the due date, they may be liable to pay a penalty of Rs. 5,000. If the return is filed after the due date but before 31st December of the assessment year, the penalty amount is reduced to Rs. 1,000. However, if the return is filed after 31st December of the assessment year, the penalty amount is increased to Rs. 10,000. In case the total income of the taxpayer does not exceed Rs. 5 lacks, the penalty amount shall not exceed Rs. 1,000.
Q: What are the benefits of filing an income tax return under Section 139(1)?
A: Filing income tax return helps in complying with the legal requirements of the Income Tax Act, claiming refunds of excess tax paid during the year, serving as proof of income for various purposes such as obtaining loans, visas, and other financial transactions, and maintaining a clean tax record, which can be beneficial in case of any future tax-related issues.
Q: Are there any exceptions to the requirement of filing income tax returns under Section 139(1)?
A: Yes, there are certain exceptions to the requirement of filing income tax returns under Section 139(1) such as individuals who have earned only exempt income during the financial year, individuals who are resident but not ordinarily resident, and have earned income outside India, etc. However, it is always advisable to consult a tax expert to determine the applicability of such exceptions.
