If you are planning to travel abroad, be sure your Income Tax Returns has been filed before the due date for easier processing of visa application, Income Tax Department has cautioned.

For individuals and entities whose books of accounts are not required to be audited, December 31 is the last date for filing returns for the Assessment Year 2021-22 (Financial Year 2020-21).

As of now, there is no indication from the Income Tax Department about any further extension.

In an advertisement, the Department said that filing on time will also help in receiving full refund and for hassle-free access to loans and credit facilities.

Listing the consequences for not filing, the Department said the assessee is liable for interest. Also, certain unadjusted losses cannot be carried forward.

As the IT return is one of the basic requirements for visa applications to most countries and the ITR should be the latest one, the Income Tax Department appears to be under-scoring this to caution late filers.

If not filed on or before December 31, the assessee gets three more months to do so but with costs. First, she/he will be required to pay ₹1,000 as late filing fee, if the annual income is less than ₹5 lakh. For others, the late filing fee is ₹5,000. This fee is over and above the penal interest on the tax due.

Sujit Bangar, Founder, Taxbuddy.com, feels tax payers should not think about extension but complete their filing immediately. “This helps earlier processing of income tax return and early refund. Secondly, there is interest at 1 per cent per month if tax payable is more than ₹1 lakh and in such cases also immediate filing of ITR and payment of tax payable is of utmost importance without waiting for due date.”

New tax portal

Bangar said that the new income tax portal has been working well though some users were facing issues. “This has resulted in reduced number of filings per day. Therefore, the government may consider extension of due date,” he said.

Sundara Rajan TK, Partner at DVS Advisors LLP, pitched for an extension of the due date. According to him, as per the twitter handle of the Department, till December 23, a total of 4.20 crore returns had been filed.

However, “if we compare this number with the total number of returns filed for the AY 2020-21 which was 5.95 crore, still 1.75 crore returns need to be filed.”

Thus, with the substantial amount of work still pending to be done on the portal front to make it more efficient to function and the lag in number of returns being filed till date, it is imperative for the Government to extend the said due date, he emphasised.