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No Penalty for Late Filing of Income Tax Return

no-penalty-for-late-filing-of-income-tax-return

No Penalty for Late Filing of Income Tax Return: The Income Law prescribes late fees for belated filing of the income tax return, filing of return of income after the deadline or due date, for Individuals and other persons. The late fees so levied is commonly known as 'Penalty for missing the ITR filing deadline for filing of income tax return or ITR. The Late fees vary according to the level of income reported by the taxpayer in the belated filing of the return. However, there is one situation under the income tax law where one is not required to pay late fees even if the return of income is filed after the ITR filing due date and is discussed in this article.

At the outset, let us discuss who is compulsorily required to file ITR or Income Tax Return.

Who are mandatorily required to file a return of income in ITR?

As per section 139(1) of the Income Tax Act, 1961, if the 'Gross Total Income' of an Individual exceeds the basic exemption limit amount in a previous year then he is compulsorily required to file the income tax return. Basic exemption limit amount is the amount of income on which no tax is payable. Thus an Individual below 60 years of age is compulsorily required to file an income tax return if his 'Gross Total Income' in FY 2018-19 exceeds Rs. 2,50,000. Similarly, for a senior citizen and a very senior citizen individual, the limit is Rs. 3,00,000 and Rs. 5,00,000 respectively.

If the 'Gross Total Income' of an individual does not exceed the basic exemption limit, then he is not required to file the income tax return though voluntarily he may file the income tax return.

For an individual filing income tax return in ITR 1, the 'Gross Total Income' is the aggregate of income under the following heads-
  • Income under the head salaries after all exemption under section 10 and 16 (which includes 'Standard Deduction'),
  • Income from House Property, and
  • Income from other sources.
If the aggregate of the income under the above three heads is more than Rs. 2,50,000 or higher, as the case may be, then return filing is compulsory.

In this context, it is important to note that due to rebate allowed under section 87A if no tax is payable, but still the taxpayer has to file the return of income since his 'Gross Total Income' is more than the basic exemption limit. For example, if the income from the salary of an individual below 60 years of age is Rs. 3,00,000 then after rebate his tax liability will be 'Nil'. But since his income exceeds the basic exemption limit of Rs. 2,50,000, he is compulsorily required to file the income tax return. Reducing the tax liability due to rebate does not absolve an individual from the filing of the income tax return.

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Due Date or Deadline for filing of Income Tax Returns:

The deadline or due date to file income tax returns vary according to the type of taxpayers and applicability of tax audit. The 'Due Date' for filing of income tax returns for various categories of taxpayers for AY 2019-20 is given below-

Categories of Taxpayers
Due Date or Deadline to file the Income Tax Return for AY 2019-20
  • A Company
  • Any person (Individual, firm, Trust, etc.) who are subject to tax audit or any other audit
  • A working partner of a firm whose accounts are subject to tax audit

30th September, 2019
Any person who is subject to Transfer Pricing Provisions and is required to furnish a report u/s 92E
30th November, 2019
A person (except a company) who is required to file a return of income on non-income criteria
31st October, 2019
In any other case
(It includes salaried individual, Business person or Professional not subject to tax audit, etc.)
31st July, 2019
(Extended to 31st August 2019)

Section 234F prescribes late fees for delay in filing of return after the due date as detailed below-

Time of filing of ITR-1
Total Income is up to Rs. 5 Lakh
Total Income is more than Rs. 5 Lakh
If ITR-1 is filed by 31st July 2019 31st August 2019
Rs. Nil
Rs. Nil
If ITR-1 is filed in the period between 1st August 2019 1st September 2019 to 31st December 2019
Rs. 1,000
Rs. 5,000
If ITR-1 is filed in the period between 1st January 2020 to 31st March 2020
Rs. 1,000
Rs. 10,000

Now with the extension, one can file the return by 31st August 2019 without paying any late fees. Any return filed by a taxpayer within the extended due date of 31st August 2019 shall be considered as a return filed within the due date.

The above example is given on the basis of ITR-1 for easy understanding of the provision related to late fees of filing of ITR. The same shall apply, with necessary changes in dates, for other ITRs.

Thus from the above table, the minimum late fees is Rs. 1,000 and maximum late fees is Rs. 10,000 for belated filing of income tax return.

In the case of a small taxpayer whose income does not exceed Rs. 5 Lakh can file his ITR after the due date but till March 2020 by paying late fees of Rs. 1,000. However, if the income exceeds Rs. 5 Lakh in FY 2018-19 then the late fees is Rs. 5,000 if the belated return is filed till December 2019. This will increase to Rs. 10,000 if the belated return is filed after December but by March 2020. After March 2020, no income tax return can be filed for AY 2019-20 by any person under the current provisions of the income tax law.

The law of imposing late filing fees under section 234F was introduced in the Budget 2017 and became effective from the financial year 2017-18 or assessment year 2018-19. Assessment year is the year immediately following the financial year for which the ITR is filed. The assessment year for the financial year 2018-19 is 2019-20.

Who will not have to pay the late fees u/s 234F for filing of ITR after the due date?

To answer this question, let us revisit the provisions of section 139(1) which mandates compulsorily filing of an income tax return by a person.

1. A company or a firm is compulsorily required to file its return of income irrespective of any quantum of income or loss.

2. Any person, other than a company or a firm, including an Individual, shall compulsorily file its return of income if the Gross Total Income exceeds the basic exemption limit as mentioned above.

3. A certain class of persons who are compulsorily required to file a return of income on non-income criteria.

4. A 'resident person' who is a beneficial owner of any foreign asset including financial interest in any foreign entity or is a signing authority in any account located outside India or is a beneficiary of any asset (including any financial interest in any entity) located outside India.

In the above cases, a person is required to file a return of income compulsorily even if the Gross Total Income is less than the basic exemption limit.

Section 234F reads as follows-

Fee for default in furnishing return of income.
234F. (1) Without prejudice to the provisions of this Act, where a person required to furnish a return of income under section 139, fails to do so within the time prescribed in sub-section (1) of the said section, he shall pay, by way of fee, a sum of,
 (a) five thousand rupees, if the return is furnished on or before the 31st day of December of the assessment year;
 (b) ten thousand rupees in any other case:
Provided that if the total income of the person does not exceed five lakh rupees, the fee payable under this section shall not exceed one thousand rupees.
(2) The provisions of this section shall apply in respect of return of income required to be furnished for the assessment year commencing on or after the 1st day of April, 2018

From the plain reading of section 234F it is clear that it is only when a person is required to file a return of income (in the above 4 mentioned cases) then he shall be liable to pay late fees u/s 234F.

There will be no late filing fees to be levied under section 234F if the income tax return is filed after the deadline if the 'Gross Total Income' of a person does not exceed the basic exemption limit and is not covered by other three cases. Section 234F draws reference of persons liable to pay late filing fees for filing a belated income tax return from Section 139. Late fees or penalty u/s 234F for belated filing of ITR after the due date cannot be levied where a person is not compulsorily required to file a return of income u/s 139.


If a person is filing his return of income voluntarily he cannot be subject to levy of late fees u/s 234F. 


The provision is further clarified with an illustration. Mr. Kishore, aged 50 years, is an Individual having no income except interest income from Fixed Deposit. On the interest income of Rs. 50,000, the bank has deducted TDS of Rs. 5,000 of which Mr. Kishore is unaware. Later in September, he came to know about the TDS. So he decided to file the return of income in September which is after the due date. He has filed his ITR-1 in September with Gross Total Income of Rs. 50,000 and claimed the TDS as a refund. Since Mr. Kishore's Gross Total Income is below the basic exemption limit of Rs. 2,50,000, he was not required to file any return of income u/s 139. Thus Mr. Kishore can file the return of income without any late fees or penalty after the deadline or due date of 31st July.


Since Mr. Kishore is filing his return of income voluntarily he cannot be subject to levy of late fees u/s 234F in the given case. 

It is mandatory to file a return of income for claiming a refund but such a condition is a procedural requirement and not mandated by law. Therefore, those returns are not subject to levy of late fees u/s 234F if filed after the deadline of return filing.

While filing the belated return online, one should be select the option 139(4)-Belated under the head 'Filed u/s *'. This is because the online utility has no option to select 'Voluntary Filing not mandated by law' or alike.


no-penalty-for-late-filing-of-income-tax-return


To Sum up, if a person is filing the return of income voluntarily and is not compulsorily required to file the return of income then no late fees is leviable for late filing of return of income after the due date or deadline.

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