ITR FY2019-20 deadline extended, but here's why you should not wait until last minute
It is to the taxpayer's benefit that the filing is not left to the last day of the extended period as waiting till the last minute to file a tax return can lead to errors.
New Delhi: Taxpayers who are yet to file their income tax return (ITR) for the financial year 2019-20 (the assessment year 2020-21), will have to do it by December 31.
The Income Tax Department recently extended the due date for filing the ITR, to ease the tax-filing process for assessments given the coronavirus crisis. Simply put, individual taxpayers now have until the end of this year to file their return of income, earned between April 1, 2019, and March 31, 2020, instead of November 30. Normally, the due date for filing ITRs for all assessees whose accounts are not required to be audited is July 31.
This extension was given to provide relief to taxpayers in these stressful times of the COVID-19 pandemic and also provide the tax officials with the room to ensure compliance with statutory and regulatory requirements across all sectors. It is to the taxpayer's benefit that the filing is not left to the last day of the extended period as waiting till the last minute to file a tax return can lead to errors.
Here's why you should not wait till Nov 30 to file ITR:
Accuracy: ITR filing requires diligent care and attention to ensure that the details are accurate. You need to have all the documents, tax statements, interest income certificates, etc. handy to ensure that all the details mentioned are correct so that there is a chance of error. Doing it carefully would avoid rectifications and revisions later. If you file your ITRs way before the deadline, the chances of ITR having errors are comparatively low to doing it in haste. The tax department issues notice to taxpayers whose ITRs are defective which is why it is better to file as early as possible.
Late interest payment: Taxpayers whose tax liability is greater than Rs 1 lakh should try to file their tax return as earlier since they would be subject to increased interest payment on the month on monthly basis. Failing to file ITR time attracts interest at the rate of 1 percent for every month or a part thereof.
Carry forward losses: In the Income Tax Act, there is a provision to carry forward losses from one FY to another. However, taxpayers can only avail of this if they file their ITRs before the due date.
Quicker refund: Taxpayers who are expecting refunds should also try to file their tax returns as early as possible so that their refunds could also be processed earlier. ITRs filed earlier get verified earlier, thus resulting in faster tax refunds.