What Is the Penalty for Not Filing an Income Tax Return (ITR) in India?
What Is the Penalty for Not Filing an Income Tax Return (ITR) in India?
Complete Guide for FY 2024–25 | AY 2025–26
Filing your Income Tax Return (ITR) is not just a financial responsibility; it’s a legal obligation for those whose income exceeds the basic exemption limit.
If you miss filing your return within the prescribed timeline, you could face penalties, interest, and other consequences.
"What happens if I do not file my ITR?"
Here’s a clear and updated guide for the Financial Year 2024–25.
✅ Due Dates for Filing ITR (FY 2024–25)
- For Individuals (Non-Audit Cases):
➔ 31st July 2025 - For Businesses Requiring an Audit:
➔ 31st October 2025
Filing after these dates can invite penalties, even if you don't have any major tax payable.
❌ Penalties for Not Filing ITR
🔹 1. Late Filing Fee under Section 234F
If you file your ITR after the due date but before 31st December 2025, the following fees apply:
|
Total Income |
Late Fee Applicable |
|
Up to ₹5,00,000 |
₹1,000 |
|
Above ₹5,00,000 |
₹5,000 |
✅ Good to know:
If your gross total income is below the basic exemption limit (₹2.5 lakh for individuals below 60 years), no late filing fee will be charged.
🔹 2. Interest on Outstanding Tax (Section 234A)
If you owe tax and haven't paid it before the due date:
- Interest at 1% per month (or part of a month) is charged on the outstanding tax amount.
- The interest is calculated from the due date till the actual date of filing.
🔹 3. Loss of Certain Benefits
If you miss filing the return on time:
- You cannot carry forward losses under:
- Capital Gains
- Business loss
- Speculative loss
Only house property losses can still be carried forward even if filed late.
🔹 4. Penalty and Prosecution (in Serious Cases)
- If tax evasion is suspected, you can face penalties ranging from 50% to 200% of the tax due.
- In extreme cases (evasion > ₹25 lakh), there could be prosecution leading to imprisonment ranging from 6 months to 7 years.
🧾 Can You Still File After the Due Date?
Yes, you can file a belated return.
- Deadline for Belated ITR:
➔ 31st December 2025 for FY 2024–25.
However, belated returns carry the penalties and restrictions explained above.
After 31st December 2025, if you still wish to file, you must file an Updated Return (ITR-U) with an additional penalty.
📌 Special Note on Updated Return (ITR-U)
- Available for 2 years from the end of the relevant assessment year.
- You must pay additional taxes:
- 25% of tax + interest if filed within 1 year
- 50% of tax + interest if filed within 2 years
✅ Why Filing on Time Matters
- To claim TDS refunds without delays
- To carry forward losses for future tax savings
- To avoid penalties and unnecessary litigation
- For faster visa processing, loans, and financial documentation
Even if your tax payable is zero, timely filing builds your compliance history with the Income Tax Department.
Final Thoughts
"It’s always cheaper and wiser to file your ITR on time—even if you owe no tax."
Avoid unnecessary penalties, interest, and complications by planning early.
If you missed the deadline, file your belated return before 31st December to minimize losses.
