File belated Income Tax returns for FY 2021-22 by December 31 to avoid penal action

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December 31, 2022, will be the last date for filing belated Income Tax returns for the financial year ended 31.3.2022 (assessment year 2022-23). Post December 31, it will not be possible to file the belated returns for the assessment year 2022-23 and it will attract additional liability, according to Abhishek Murali, former president, All India Tax Payers’ Association (AITPA).

The only alternative option will be to file an updated return under section 139(8A) of the Income Tax Act [subject to certain conditions and restrictions stated therein] with additional liability of 25% of the aggregate amount of tax and interest, he said. Failure to file the returns may lead to prosecution under section 276CC of the Act.

With the complete digitisation of all the data of every entity, it has become very easy for the Income Tax department to identify non-filers of tax returns and to initiate proceedings against them.

Mr. Abhishek also pointed out that the Income Tax Act mandates all partnership firms, Limited Liability Partnerships and companies to file Income Tax returns, irrespective of whether they were dormant with no activity or no transaction during the period.

So, such entities should make sure they file returns showing nil income before December 31, to avoid any penal consequences, he added.