The deadline for filing Income Tax Returns (ITR) is July 31 this year, and missing this deadline can lead to significant consequences. If you fail to file by July 31, you can still submit a belated return by December 31, 2024. However, missing the deadline means you will be automatically shifted to the new tax regime, losing the option to choose the old tax regime for that financial year.
Currently, there are two tax regimes: the old regime and the new regime, which was introduced in 2020 with updated tax slabs and reduced rates.
If you miss the July 31 deadline, you can file a late return, but under Section 234F of the Income Tax Act, a late fee of ₹5,000 may be imposed. If your income is below ₹5 lakh, the late fee is reduced to ₹1,000. Additionally, interest will accrue at 1% per month or part of a month on the outstanding tax from the due date. However, the penalty cannot exceed the amount of tax owed.
Furthermore, late filers will forfeit the ability to carry forward any capital losses. This means these losses cannot be used to offset future gains, potentially increasing your tax liability in subsequent years.
