The Indian Income Tax Act, of 1961 has several provisions for the collection of taxes, and one of them is Section 234F. This section deals with the late filing fees of Income Tax Returns (ITRs). The purpose of this section is to encourage taxpayers to file their ITRs within the due date, i.e., before the deadline. This article aims to provide a comprehensive understanding of Section 234F, its provisions, and its implications.
Provisions of Section 234F:
Section 234F was introduced in the Finance Act, of 2017, and it came into effect on 1st April 2018. As per the provisions of this section, a taxpayer has to pay a late filing fee if he or she fails to file ITR on or before the due date. The due date for filing ITRs for individuals is 31st July of every assessment year. The due date for taxpayers who are required to get their accounts audited is 30th September.
The amount of the late filing fee depends on the delay in filing the ITR. If the ITR is filed after the due date but before 31st December of the assessment year, the late filing fee is Rs. 5000. However, if the ITR is filed after 31st December of the assessment year, the late filing fee will increase to Rs. 10,000.
For taxpayers whose total income does not exceed Rs. 5 lakhs, the late filing fee is Rs. 1000 if the ITR is filed after the due date but before 31st December of the assessment year. However, if the ITR is filed after 31st December of the assessment year, the late filing fee will increase to Rs. 10,000.
Implications of Section 234F:
Section 234F has significant implications for taxpayers who fail to file their ITRs on time. The late filing fee can be an additional financial burden for taxpayers, especially for those who have not filed their ITRs for several years. Moreover, late filing fees are not eligible for any deduction under the Income Tax Act.
It is also important to note that taxpayers cannot file their ITRs for a particular assessment year after the end of the relevant assessment year. This means that if a taxpayer fails to file their ITR for the assessment year 2020-21 before the due date, he or she cannot file it after 31st March 2022.
Final Conclusion:
In conclusion, Section 234F of the Income Tax Act is a significant provision that aims to encourage taxpayers to file their ITRs on time. The late filing fees under this section can be a significant financial burden, and taxpayers must make sure to file their ITRs before the due date to avoid paying these fees. It is also essential to keep track of the due dates for filing ITRs to ensure compliance with the Income Tax Act.
Frequently Asked Questions:Â
Q: What is section 234F of the Income Tax Act?
A: Section 234F is a provision under the Income Tax Act that was introduced by the Finance Act, of 2017. It deals with the late filing of income tax returns and prescribes a penalty for such late filing.
Q: Who is liable to pay the penalty under section 234F?
A: Any individual, Hindu Undivided Family (HUF), Association of Persons (AOP), Body of Individuals (BOI), or any other taxpayer who is required to file an income tax return under the Income Tax Act and fails to do so within the due date is liable to pay the penalty under section 234F.
Q: What is the amount of penalty under section 234F?
A: The penalty amount under section 234F depends on the time of filing the income tax return. If the return is filed after the due date but on or before December 31 of the relevant assessment year, the penalty amount is Rs. 5,000. However, if the return is filed after December 31 of the relevant assessment year, the penalty amount is increased to Rs. 10,000.
Q: Is there any exemption from the penalty under section 234F?
A: Yes, there are certain exemptions from the penalty under section 234F. If the total income of the taxpayer does not exceed Rs. 5 lakhs, the penalty amount is limited to Rs. 1,000. In addition, the penalty does not apply if the return is filed after the due date but before the end of the relevant assessment year, and the total income of the taxpayer does not exceed Rs. 5 lakhs.
Q: Can the penalty under section 234F be waived?
A: No, the penalty under section 234F is a mandatory penalty, and there is no provision for waiver or reduction of the penalty.
Q: Can the penalty under section 234F be challenged in court?
A: No, the penalty under section 234F is a penalty prescribed under the Income Tax Act, and there is no provision to challenge the penalty in court. However, if there is an error in the computation of the penalty or the penalty is imposed wrongly, the taxpayer can file a rectification application or an appeal with the appropriate authority.
