What Happens If You Have Not Filed Your Income Tax Return (ITR) on Time?

Q: What happens if I miss the ITR deadline?

You can file a belated return by 31st December, but you will have to pay a penalty under Section 234F. If taxes are due, interest under Section 234A will also be applicable.

Q: Can I revise my ITR after filing?

Yes, if you make an error in your ITR, you can file a revised return before 31st December of the assessment year.

Sujit Bangar
Oct 23, 2019
6 min read

Updated: Mar 31

Filing your Income Tax Return (ITR) on time is not just a legal obligation but a crucial financial practice. Missing the deadline can result in penalties, interest charges, loss of tax benefits, and even prosecution under specific sections of the Income Tax Act. This article explains the importance of timely ITR filing, its benefits, and the consequences of failing to comply.

What Happens If You Have Not Filed Your Income Tax Return (ITR) on Time

Budget 2025: Key Tax Updates

Major Tax Relief: FY 2025-26 brings significant tax benefits for individual taxpayers.
Zero Tax Liability:
- Incomes up to ₹12 lakh are tax-free due to an increased rebate under Section 87A.
Simplified Tax Structure:
- New tax slabs reduce the overall tax burden and make compliance easier.

Updated Income Tax Slabs for FY 2025-26

Up to ₹4,00,000 – NIL (No tax)
₹4,00,001 - ₹8,00,000 – 5%
₹8,00,001 - ₹12,00,000 – 10%
₹12,00,001 - ₹16,00,000 – 15%
₹16,00,001 - ₹20,00,000 – 20%
₹20,00,001 - ₹24,00,000 – 25%
Above ₹24,00,000 – 30%

The revised tax regime ensures higher savings and easier tax compliance, especially for salaried and middle-income taxpayers.

What is an ITR and Why is it Important?

An Income Tax Return (ITR) is a mandatory document that taxpayers must file with the Income Tax Department of India to declare their income, deductions, and tax liabilities. It helps determine the amount of tax owed or refundable.

Why is Filing ITR Important?

Legal Compliance: Filing ITR is a legal requirement for individuals whose income exceeds the exemption limit. Non-compliance may result in penalties, interest charges, and legal action under the Income Tax Act. Timely filing ensures that you meet your obligations as a responsible taxpayer and avoid unnecessary legal consequences.
Claiming Tax Refunds: If excess tax has been deducted at source (TDS) or paid in advance, filing ITR is necessary to claim a refund. Without filing, the refund process cannot be initiated, leading to financial losses.
Proof of Income: An ITR serves as documented proof of income for various purposes, including applying for home loans, personal loans, or visas. Many financial institutions and embassies require ITR filings to assess financial stability.
Carry Forward Losses: Taxpayers can carry forward business or capital losses and offset them against future gains only if they file their ITR within the due date. This can significantly reduce tax liability in subsequent years.
Avoiding Penalties: Failure to file ITR on time attracts penalties under Sections 234A, 234B, and 234F. Additionally, interest is levied on outstanding tax amounts, increasing the financial burden.
Easier Loan and Credit Approvals: Banks and lending institutions often require ITR records for processing loan applications. A consistent record of tax filing enhances creditworthiness and simplifies the approval process for loans and credit cards.
Contributing to Nation-Building: Taxes collected from ITR filings help fund national infrastructure, healthcare, education, and other essential public services. Filing taxes on time is a civic duty that contributes to the overall development of the country.

Who is Required to File an ITR?

Filing an ITR is mandatory if:

Your total income exceeds the exemption limit (₹2.5 lakh for individuals, ₹3 lakh for senior citizens).
You have foreign income or investments, including assets or bank accounts outside India.
You are eligible for a tax refund due to excess TDS deductions or advance tax payments.
Your business turnover exceeds ₹60 lakh or professional income exceeds ₹10 lakh.
You have deposited more than ₹1 crore in a current account or ₹50 lakh in a savings account.
Your foreign travel expenses exceed ₹2 lakh or electricity bills exceed ₹1 lakh.
You have incurred capital gains from selling shares, mutual funds, property, or other assets.
Your TDS or TCS deductions exceed ₹25,000 (₹50,000 for senior citizens).

Consequences of Not Filing ITR on Time

1. Late Filing Penalties (Section 234F)

A penalty of ₹1,000 is levied if income is below ₹5 lakh.
A penalty of ₹5,000 is imposed if income exceeds ₹5 lakh (applicable if filed after 31st July but before 31st December 2025).

2. Interest on Outstanding Tax (Section 234A)

If tax is due, interest at 1% per month is charged on the outstanding amount from the due date until the date of filing.

3. Additional Penalty for TDS/TCS Returns (Section 271H)

If TDS/TCS returns are not filed, a penalty ranging from ₹10,000 to ₹1,00,000 applies.
An additional fine of ₹200 per day is charged until the return is filed.

4. Loss of Financial Benefits

Carry Forward Losses: Business or capital losses cannot be carried forward if ITR is not filed within the due date.
Refund Delays: If you are eligible for a tax refund, late filing may result in delayed processing and disbursement.

5. Difficulty in Loan and Visa Approvals

Banks require ITR documents for loan approvals, especially for home and business loans.
Many embassies require ITR records for visa applications, particularly for long-term visas.

6. Prosecution for Tax Evasion (Section 276CC)

If unpaid tax exceeds ₹25,000, imprisonment ranging from 6 months to 7 years may be imposed.
For smaller amounts, imprisonment can range from 3 months to 2 years, along with a fine.

What are the Due Dates for Filing Income Tax?

FY 2023-24

Category of Taxpayer	Due Date (Original Return) FY 2023-24
Company (whether tax audit applicable or not applicable)	15th November 2024
Other than a company to whom tax audit is applicable	15th November 2024
Partner of the firm to whom tax audit is applicable	15th November 2024
Audit Returns required under Section 92E	30th November 2024
Assesses not required to get Accounts Audited	31st July 2024
Revised Return/Belated Return	31st December 2024
Updated Return (ITR-U)	31st March 2026

FY 2024-25

Category of Taxpayer	Due Date (Original Return) FY 2024-25
Company (whether tax audit applicable or not applicable)	15th November 2025
Other than a company to whom tax audit is applicable	15th November 2025
Partner of the firm to whom tax audit is applicable	15th November 2025
Audit Returns required under Section 92E	30th November 2025
Assesses not required to get Accounts Audited	31st July 2025
Revised Return/Belated Return	31st December 2025
Updated Return (ITR-U)	31st March 2027

FAQ

Q1: Do I need to file ITR if my income is not taxable?

A: Filing a Nil return is not compulsory; it’s discretionary. ITR filing becomes mandatory only if your income exceeds the basic exemption threshold (₹2.5 lakh in the old regime, ₹3 lakh in the new regime). However, there are exceptions where you must file an ITR even if your income is below the exemption limit.

Q2: Can I file ITR for the last three years?

A: Yes, you can file an ITR-U or Updated Return for up to three years before the year in which you are filing. However, filing an updated return comes with penalties and notices.

Q3: What is the maximum age to file ITR?

A: Senior citizens (aged 75 and above) are exempt from filing ITR under specific conditions, such as receiving only pension and interest income from specified banks.

Q4: Is ITR mandatory for everyone?

A: No, but it is mandatory for individuals whose gross total income exceeds ₹2.5 lakh (₹3 lakh for senior citizens) in a fiscal year. Certain other conditions also require filing, such as having foreign assets or deposits above specified limits.

Q5: What happens if I miss the ITR deadline?

A: You can file a belated return by 31st December, but you will have to pay a penalty under Section 234F. If taxes are due, interest under Section 234A will also be applicable.

Q6: Can I revise my ITR after filing?

A: Yes, if you make an error in your ITR, you can file a revised return before 31st December of the assessment year.

Q7: Do NRIs have to file ITR?

A: Yes, NRIs must file ITR if their income earned in India exceeds the basic exemption limit or if they have taxable income from capital gains, property, or business in India.

Q8: Can ITR filing help with getting a loan?

A: Yes, banks and financial institutions require ITR records for loan approvals, especially for home loans, personal loans, and business loans.

Q9: Is ITR filing necessary for self-employed individuals?

A: Yes, self-employed individuals, freelancers, and professionals must file ITR if their gross income exceeds ₹2.5 lakh. Additionally, maintaining proper tax records helps with financial planning and credit approvals.

Q10: Will I get a tax refund if I file ITR late?

A: Yes, but processing may be delayed. The Income Tax Department will process the refund only after filing and verification, which may take additional time if filed after the deadline.

Q11: What is the penalty for not filing ITR?

A: A penalty of ₹1,000 (income below ₹5 lakh) or ₹5,000 (income above ₹5 lakh) applies if the return is filed after 31st July but before 31st December. Additionally, if there are unpaid taxes, interest will be charged.