Final day for filing income tax returns for audits: Penalties for missing the deadline

Income Tax Returns: Today marks the final deadline for filing Income Tax Returns (ITRs) for taxpayers whose accounts were required to undergo an income tax audit for the financial year 2023-24 (Assessment Year 2024-25). Missing this November 15 deadline could lead to significant financial penalties, including interest charges and fines.

The Central Board of Direct Taxes (CBDT) extended the original tax filing deadline from October 31 to November 15, 2024, giving more time to those with audit requirements under the Income Tax Act or other applicable laws. This applies to corporate entities, individuals undergoing income tax audits, and partners of firms with audited financial records. For those falling within these categories, today is the final day to ensure compliance with the tax filing deadline.

To complete their ITR filing, taxpayers under audit must provide details such as the submission date of their tax audit report and its acknowledgment number. Missing the tax audit deadline can lead to forfeiting the November 15 extension and incurring penalties. The original deadline for submitting the audit report was September 30, 2024, which was later extended to October 7, 2024, to facilitate a smoother tax filing process.

Penalties for missing today’s deadline

If the November 15 deadline is missed, taxpayers can still submit a belated return by December 31, 2024, but this will lead to late tax filing penalties. Key penalties include:

Missing the November 15 tax filing deadline can lead to several penalties. Taxpayers may face interest charges under Sections 234A and 234B for unpaid taxes, while a late filing penalty under Section 234F could range from Rs 1,000 to Rs 5,000, depending on their income level. Additionally, failing to submit the tax audit report on time could attract a penalty of up to Rs 1.5 lakh or 0.5% of total sales, whichever is lower, as outlined under Section 271B.

Impact of missing the deadline on future compliance

Failure to file an ITR by today’s deadline may also impact a taxpayer’s compliance record. For corporate taxpayers, non-compliance could affect the ability to secure loans, participate in government tenders, and demonstrate creditworthiness. Individuals who miss the deadline could face increased scrutiny from tax authorities, as repeated delays can trigger more frequent audits and assessments in subsequent years.

Practical steps to meet the deadline

"For those yet to file, it’s essential to double-check that the audit report acknowledgment number and submission date are accurately entered in the ITR. Additionally, I recommend using the tax portal to confirm any outstanding tax dues and clearing any balances immediately to avoid further interest accumulation,” Arpit Suri, a Noida-based CA, advised.

“Given that the e-filing portal is likely to experience high traffic today, it’s wise to file as early as possible to avoid last-minute delays,” he added.

Even if the November 15 deadline is missed, taxpayers can file a belated return by December 31, 2024, with associated late fees and interest. However, submitting a belated return limits the taxpayer’s ability to revise or correct their filing, leaving little room to address errors once filed. To avoid complications, it’s advisable to meet today’s deadline for a more straightforward and penalty-free filing experience.

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