Steep penalty likely for delay in filing I-T returns

Steep penalty likely for delay in filing I-T returns

Non-filers of income tax returns will now face a steep fine. The government has proposed an amendment to the provisions in the income tax rules

For people earning below Rs 5 lakh, filing returns after July will attract a fine of Rs 1,000 and those with earnings above Rs 5 lakh would face a fine of Rs 5,000. “Those who have an income over Rs 5 lakh and file returns after July but till December will face a fine of Rs 5,000. This fine will be raised to Rs 10,000 if the return is filed after December,” revenue secretary Hasmukh Adhia said at a post-budget event organised by the Institute of Chartered Accountants of India. 

At present, there is no fine if the returns are filed with a delay within the assessment year, but a penalty of Rs 5000 could be imposed if the filing was after it. But the income tax department did not aggressively pursue this. Adhia said that there are 50 lakh companies registered in the country of which just 6.9 lakh filed income tax returns. He asked members of the institute to encourage their clients to file returns. 

NO RESPITE FROM POEM AND GAAR 

Adhia made it clear that these antiabuse measures were here to stay. Industry has pitched for deferral of these provisions seeking some more time for preparation so that investors are not caught on the wrong foot. “PoEM (Place of Effective Management) and GAAR (General Anti-Avoidance Rule) norms are here to stay….GAAR has already been deferred for the last five years,” he said. 

He said suitable clarifications have been provided and adequate safeguards put in place to allay apprehensions of the industry that there will be harassment by tax authorities. “PoEM is for those companies that are creating structures outside just to make passive income outside India to escape tax net,” he said.

Source:-The Economic Times