Filing your Income Tax Return (ITR) is not just a legal obligation; it’s a crucial financial responsibility. Neglecting this duty can have far-reaching consequences that extend beyond the immediate repercussions. Let’s have look on consequences of not filing your ITR.
Penalties & Late Fees:
Penalty under section 235F will be levied upto Rs. 5000/- for non-filing of ITR.
Interest on Tax Due:
Apart from the penalty for late filing under section 235F, interest will be charged under Section 234A at 1% per month or part thereof on tax due until the payment of taxes.
Loss of Refund:
If you’re entitled to a tax refund but fail to file your ITR, you won’t receive the money you were entitled to receive from Income Tax Department.
No Set Off/Carry Forward of Losses:
If Losses are incurred and ITR is not filed, then the taxpayer will not be allowed to carry forward and set off losses.
Notice U/s 142(1) and Best Judgement Assessment:
If ITR is not filed then Income Tax Department can send notice U/s 142(1) and initiate Best Judgement Assessment against the taxpayer.
No Loan:
Bank and Financial Instititions normally require ITR for at least lastest two Financial Year to process LOan applications. If ITR is not filed then loan application will be rejected.
Difficulty in Visa Processing:
Most embassies & consulates requires assessee to furnish copies of his/her tax returns for the past couple of years for processing the visa application. Non Filing of ITR will create difficulties in VISA approval.
