No matter what the deadline is to file the ITR, we often tend to forget and somehow manage everything at the last minute and sometimes miss the deadline as well. As we know, the Central Board of Direct Taxes (CBDT) has extended the deadline to file the ITR for the financial year 2020-21 once to December 31. However, in case you forget to file their ITR on time, you may have to pay a penalty of Rs 5,000. Remember, earlier the deadline was September 30.
For the unversed, until last year the penalty for filing the ITR late was Rs 10,000 but this year it has been reduced to Rs 5,000. Until last year, if a person filed the ITR late between August-December or December-March then they had to pay a total late fee of Rs 10,000 (Rs 5,000 for each time). But now the maximum amount for the current assessment year has been raised to Rs 5,000.
Notably, if someone's annual income is less than Rs 5 lakhs, then they will have to pay a penalty of Rs 1,000 as a penalty as income tax is not payable on annual income less than Rs 5 lakh. But, under section 234A of the Income Tax Act, if a person owes tax of more than Rs 1 lakh, then they will be liable to a penalty of 1% every month. This penalty will continue to be levied till they file ITR.
