Late in ITR filing?Experts decode fees, refund delays and lost tax benefits

Experts explain late ITR filing fees, refund delays, loss of carry-forward benefits and why you should still file your belated ITR before 31 December to limit the damage

If you missed the 16 September deadline for filing your Income Tax Return (ITR), it’s not too late to act. Tax experts say you can still file a belated return, but with some financial consequences. Here’s what you need to know.

 

What a belated return really costs

Filing late is not just a compliance issue; it can cost you money and benefits. Mrinal Mehta, chartered accountant & joint secretary of Bombay Chartered Accountants’ Society, says a late filing fee under Section 234F applies. “It is Rs 1,000 if your income is below Rs 5 lakh, and Rs 5,000 otherwise. On top of this, interest under Section 234A at 1 per cent per month applies on any unpaid tax, along with 234B and 234C interest for advance tax shortfalls.”

 

According to Niyati Shah, chartered accountant and tax expert in personal tax at 1 Finance, the bigger hit is the “inability to carry forward certain losses like capital or business losses – though house-property loss can still be carried forward. Refunds are also delayed because belated returns are processed after on-time ones.”

 

“Late filers lose the option to switch to the old tax regime if that was more favourable, often resulting in a higher tax outgo,” added Aarti Raote, partner, Deloitte India.

How and when to file now

The process remains the same as a regular return. “Taxpayers simply need to select Section 139(4) - Belated Return while filing online,” says Sameer Mathur, managing director & founder, Roinet Solution.

 

Shefali Mundra, tax expert at ClearTax, reminds taxpayers that “the belated return must be e-verified within 30 days of filing, otherwise it is treated as not filed.” The final deadline for AY 2025–26 is 31 December 2025, unless the government extends it. 

 

Real-world impact: missed opportunities

 

Mehta cites a case where “a salaried taxpayer with Rs 10 lakh F&O losses missed the deadline and had to pay full salary tax without the benefit of carrying forward those losses, plus late fees and interest.”

 

Mundra shares the case of Aditya, a 32-year-old from Pune, who lost the ability to carry forward Rs 55,000 in capital losses and also received lower interest on his TDS refund because he filed late. 

Avoiding a repeat next year

Experts unanimously advise starting early. “Begin reconciling AIS/TIS and Form 26AS by June-July, set calendar alerts, and keep documents ready,” says Raote. Shah calls timely filing “an annual financial ritual, not just a statutory chore that saves stress and money.”