What Happens if You Fail to File ITR on Time

The Income Tax Department of India mandates taxpayers to file their Income Tax Returns (ITR) every year by a specific due date. Failing to do so can result in various penalties, interest, and legal consequences. In this article, we will discuss the repercussions of not filing ITR on time.

If you fail to file your Income Tax Return (ITR) on time, you may face penalties and consequences. The penalty for late filing can vary depending on factors like your total income and the delay in filing. You may have to pay a fine or penalty, and there could be additional interest charges on any outstanding tax amount.

Moreover, you may also lose out on certain benefits or deductions that are available only to those who file their returns within the deadline. Additionally, it could also lead to scrutiny or audit by the tax authorities, resulting in further complications. It’s important to file your ITR on time to avoid these consequences.

Late Filing Fee:

The government of India introduced a late filing fee for taxpayers who miss the deadline for filing ITR. As per Section 234F of the Income Tax Act, 1961, if the ITR is filed after the due date, then the taxpayer has to pay a late filing fee. The amount of late filing fee depends on the time of filing.

If the return is filed on or before December 31 of the assessment year, then the late filing fee is Rs. 5,000. If the return is filed after December 31 but before March 31 of the assessment year, then the late filing fee is Rs. 10,000. However, if the taxpayer’s total income does not exceed Rs. 5 lakhs, then the late filing fee is capped at Rs. 1,000.

Interest on Delayed Payment:

If the taxpayer has a tax liability and fails to pay it before the due date, then interest will be charged on the outstanding amount. The interest is calculated at the rate of 1% per month or part of the month. This interest is calculated from the due date of payment till the date of actual payment.

Prosecution:

If the taxpayer fails to file ITR on time and has a tax liability, then he/she can be prosecuted under the Income Tax Act. Section 276CC of the Income Tax Act provides for prosecution in case of willful evasion of taxes or non-filing of ITR. The penalty for this offense can be imprisonment for a term of 3 months to 2 years along with a fine.

Unable to Carry Forward Losses:

If the taxpayer fails to file ITR on time, then he/she may not be able to carry forward losses to future years. For instance, if a taxpayer incurs a loss in a financial year and fails to file ITR by the due date, then he/she may not be able to carry forward the loss to the next year. This can result in a higher tax liability in the subsequent years.

Difficulty in Obtaining Loans and Visas:

Many financial institutions and embassies require ITR as proof of income. If the taxpayer fails to file ITR on time, then he/she may face difficulty in obtaining loans, visas, and credit cards. This can also affect the taxpayer’s credit score, which can impact his/her ability to obtain credit in the future.


Filing ITR on time is essential to avoid penalties, interest, and legal consequences. The late filing fee can be a significant burden, especially for taxpayers with a lower income.

It is, therefore, crucial for taxpayers to file their ITR on time and pay their tax liability before the due date. Additionally, by filing ITR on time, taxpayers can carry forward losses to future years and avoid any difficulty in obtaining loans or visas.


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