You have finally decided on your dream home and you are applying for a bank loan to partially finance the cost of your new home. The bank may ask you for your income tax returns for the last 2-3 financial years to process your loan application. But you do not have them because you never felt the need to file ITRs. So, how do you now file income tax returns for the last years?
Delaying the filing of income tax returns has more than one negative consequence.
Some more serious consequences are listed below and these should be enough to stop you from delaying ITR filing (unless of course there are extraordinary reasons beyond your control). You may be prosecuted, in rare and extreme cases, if the income tax officer infers that you are a wilful defaulter.
i. If the tax due is less than Rs.25 lakhs, you may be imprisoned for anytime between 3 months and 2 years;
ii. If the tax due is greater than Rs.25 lakhs, you may be imprisoned for anytime between 6 months and 7 years.
Follow this process to file your income tax return (ITR):
1. Log on to the Income Tax Department’s website
2. Login to your account with your ID (generally PAN) and password
3. In case you have forgotten your password, you may reset the same by clicking “forgot password”
4. If you are logging in for the first time, register yourself
5. Click on the drop-down menu named “e-file”
6. Choose “income tax return” followed by “file income tax return”
7. Reiterating steps 6 and 7. Follow this path Dashboard>e-file>income tax return>file income tax return
8. Select Assessment Year 2021-22
9. Proceed with the subsequent steps of selecting the appropriate form and entering the required details
You cannot file an ITR for the last 3 years altogether in one go in a year. No clause allows you to file the returns once you have surpassed the due date. In specific cases, however, there could be a special condonation, if you seek one, with convincing evidence. The income tax officer may consider your case based on its merits. For example:
While delays in ITR filing attract penalties and other disadvantages, filing your ITR every year offers multiple benefits. Some of the important benefits are:
- Claim your TDS refund
- Have a reliable and widely accepted income proof
- Helps in loan disbursements
- Foreign travel becomes easier
- You can carry forward your business and capital losses
ITR filing should be done on time to maintain a good track record. If you miss filing returns, you may find it difficult to apply for loans, visas etc. Other benefits of filing ITRs before the due date is quicker refunds, interest on refunds, no penalty and above all zero stress.Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised to exercise their caution and not to rely on the contents of the article as conclusive in nature. Readers should research further or consult an expert in this regard.