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Consequences of Non-Filing of Income Tax Return by NRI



consequences of non-filing of ITRThe procedure of filing returns is same as that of a resident Indian. NRI with gross total income exceeding Rs 10 lakh must file the returns electronically and send ITR-V within 120 days of filing return. If individuals file their returns after the last date of filing Return of Income, they will be charged interest at the rate of 1% per month of delay. Further, if such a return is filed after one year from the end of the tax year concerned, apart from the interest, they will also be liable for a penalty of Rs 5,000. The due date of filing the return of income by a NRI is July 31st. However, if the NRI is a working partner of a firm whose accounts are required to be audited, then the due date is September 30.

All the NRI are required to file income tax return if they satisfy either of these conditions:

  • The taxable income in India during the previous year was above the basic exemption limit
  • Have earned short-term or long term capital gains from sale of certain investments and assets, even if the gains are less than the basic exemption limit.

Due Date of Filing Income Tax Return for an NRI - The due date of filing income tax return for the financial year 2012-13 is 31st July 2013.

The last date to file returns for the financial year is July 31st. However following must be considered:

  • In case if tax payable is nil that is all tax has been deducted at source, individual can still file tax return within 2 years from the end of the financial year without any penalties.
  • In case if tax payable is nil, individual can still file belated returns within 2 years from the end of financial year but he/she will be charged an interest of 1% per month for every month of delay starting from the due date of filing return till the time returns under section 234A is filed by the individual.
  • In case if individual do not file his/her tax returns at all, then he/she may be charged a penalty of Rs 5,000 for every year of delay under section 271F.

There are several other consequences like individual cannot revise a return that was filed late and may also lose out on interest receivable on refund for the period of delayed filing.

About: 

Alok Patnia founded Taxmantra.com, an expert in tax advisory & compliance. He is a Chartered Accountant having prior exposure with Ernst & Young & KPMG.

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