Daijiworld Media Network – New Delhi

New Delhi, Jul 29: With the July 31 deadline fast approaching, taxpayers have only a few days left to file their Income Tax Returns (ITR) for the financial year 2025-26. Salaried individuals and taxpayers whose accounts are not subject to audit must submit their returns by the due date to avoid penalties and other consequences.

Those who miss the deadline can still file a belated return under Section 139(4) of the Income Tax Act, 1961, on or before December 31, 2026, or before the completion of the assessment process.

However, filing a belated return comes with financial implications. Under Section 234F, taxpayers may be required to pay a late fee of up to Rs 5,000. For individuals with a total annual income of up to Rs 5 lakh, the penalty is capped at Rs 1,000.

Late filing may also delay the processing of tax refunds, particularly for taxpayers eligible to claim excess Tax Deducted at Source (TDS). In addition, interest at the rate of one per cent per month may be levied on any outstanding tax liability under Section 234A.

Tax experts also caution that failure to file returns on time could invite scrutiny or compliance notices from the Income Tax Department.

If taxpayers fail to file even the belated return by December 31, they will have to submit an Updated Income Tax Return (ITR-U) under Section 139(8A) of the Income Tax Act. While ITR-U allows taxpayers to report omitted income or correct mistakes in previously filed returns, it attracts additional tax, interest and penalties. It also cannot be used to claim a refund or reduce tax liability.

The Income Tax Department has advised eligible taxpayers to complete the filing process before the July 31 deadline to avoid unnecessary penalties, delays and legal complications.