1. Late filing of income tax returns: Mandatory fee applicable for AY 2018-19

Late filing of income tax returns: Mandatory fee applicable for AY 2018-19

It is advisable that you file your return of income before the due date even though you do not have any income chargeable to tax.

By: | New Delhi | Published: July 19, 2017 2:43 AM
Late filing of income tax returns, Income Tax, I-T Act The I-T Act allows a taxpayer to carry forward business loss and adjust it against his business income of future years.

Is mandatory fee for late filing of returns applicable from this assessment year, i.e., 2017-18?

– Nitin Bhasin

Section 234F is a new provision introduced by the Finance Act, 2017 which states that fees shall have to be paid mandatorily for late filing of income-tax returns. However, this section will come into effect from Assessment Year (AY) starting on or after April 1, 2018. As such, it will be applicable from AY 2018-19 and not from AY 2017-18. However, penalty for failure to furnish return of income under section 271F up to Rs 5,000 may be levied in respect of assessment year 2017-18 if return is filed after the end of the relevant assessment year.

I am a small shopkeeper. During FY 2016-17, I had suffered losses in my business. Do I need to file I-T return even if I have no taxable income?

—Bhargav Buddhadev

The I-T Act allows a taxpayer to carry forward business loss and adjust it against his business income of future years. However, this benefit is available only if return has been filed on time, i.e., on or before the due date. Thus, it is advisable that you file your return of income before the due date even though you do not have any income chargeable to tax. This will help you in carrying forward losses of FY 2016-17 which can be adjusted against the business income of subsequent years.

I was recently transferred from an Indian company to its US sister concern. I left India on April 1, 2016 in connection with my US employment. My employer paid salary in India. I have paid taxes on salary income in USA.

Do I need to pay tax on such income in India also?

— Sagar Rastogi

Your tax residential status in India would be non-resident for the financial year 2016-17 as number of days of stay in India is less than 182 days in the financial year 2016-17. In case of a non-resident, salary income is taxable in India only if services are rendered in India. As in your case, services were rendered by you in USA and taxed in the USA. Applying the Article 16(1) of Indo-USA DTAA, since employment was exercised in USA, it will not be taxable in India irrespective of the fact that the salary was paid by an Indian company in India.

The writer is founder of RSM Astute Consulting Group. Send your queries to fepersonalfinance@expressindia.com

  1. H
    HEMANT MEHTA
    Jul 20, 2017 at 9:51 am
    I HAVE DIFFERENCE IN PAN CARD NAME AND AADHAR CARD NAME IN PAN CARD NAME IS HEMANT KUMAR MEHTA AND IN AADHAR CARD NAME IS HEMANT MEHTA WHAT I HAVE TO DO NOW
    Reply
    1. N
      Narendra M Apte
      Jul 19, 2017 at 8:34 am
      It is necessary for every taxpayer to file her/his Income Tax Return (ITR) in time. She/he cannot offer excuses for delaying submission of ITR. This is fine. However, new rule, which is to come into effect from Assessment Year (AY) 2018-19, that for delayed ITR there would be fine of a minimum of Rs. 1,000/- is unfair for those whose tax liability would be zero. Many times tax payers have to file ITRs for ‘technical’ that is to claim tax rebate under Section 80C. In case of retired senior citizens it is possible that she/he may not be in a position to file ITR on grounds of health.etc. In such cases the new rule does not provide for exemption: everyone has to file ITR in time or pay the fine. I believe that this new rule must be amended to provide (a) that ITR can be filed by senior citizens without a fine by last date of AY or (b) that there would be zero fine for zero tax liability.
      Reply

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