Claiming Refunds in Belated Tax Returns: A Comprehensive Guide

Understanding Belated Tax Returns

Belated tax returns are returns filed after the standard tax filing deadline. In India, under Section 139(4) of the Income Tax Act, taxpayers can file belated returns within three months prior to the end of the relevant assessment year or before the completion of the assessment, whichever is earlier.

Eligibility for Refund Claims in Belated Returns

Yes, taxpayers can claim refunds in belated tax returns filed under Section 139(4). However, it’s important to note that certain limitations and consequences apply.

Limitations on Refund Claims

  • Time Limit: Refunds can only be claimed within two years from the date of paying the tax or three years from the date of filing the original return, whichever is later.
  • Deductions and Losses: Certain deductions and losses, such as those under sections 10A, 10B, 80-IA, 80-IB, 80-IC, 80-ID, and 80-IE, may not be allowed in belated returns.
  • Interest on Refunds: Taxpayers may lose interest on refunds if the delay in filing is due to their own actions.

Consequences of Filing Belated Returns

  • Interest Penalty: Interest at 1% per month or part of a month is levied on the tax payable from the original due date until the date of filing the belated return.
  • Late Filing Fees: Penalties ranging from INR 1,000 to INR 5,000 may be imposed for late filing, depending on the taxpayer’s income.

Procedure for Claiming Refunds in Belated Returns

To claim a refund in a belated return, taxpayers should:

  • File the belated return using Form 1040X, “Amended U.S. Individual Income Tax Return.”
  • Indicate the amount of refund being claimed on the return.
  • Attach supporting documentation, such as proof of income and expenses.
  • E-verify the return using the IRS’s online portal.

Additional Considerations

  • Taxpayers can revise belated returns to carry forward trading losses.
  • The change of tax regime is not possible while filing a return under Section 139(4).
  • If a taxpayer fails to file a belated return, the Income Tax Department may send a notice requesting the filing of the return.

While filing a belated tax return may result in penalties and limitations, taxpayers can still claim refunds if they meet the eligibility criteria. It’s crucial to understand the consequences and limitations associated with belated returns to ensure accurate and timely tax filing.

8 (Types of Return )Can I claim my refund in case of belated return


Is refund allowed in belated return?

Yes, you can claim a tax refund while filing a belated return u/s 139(4). You must pre-validate your bank account to receive the refund, as the refund will be directly credited to your bank account added on the e-filing portal.

Can I still receive a refund on late filing?

you cannot obtain a refund without filing a tax return. If you wait too long to file, you may risk losing the refund altogether. In cases where a return is not filed, the law provides most taxpayers with a three-year window of opportunity for claiming a refund.

Can refund be claimed in updated return?

Filing belated or revised ITRs after 31st December of the AY is not possible. However, you can file an updated return using the ITR-U form from January 1st of AY, which is used to correct minor errors or omissions in your original ITR. With ITR-U, you cannot reduce the taxes due, claim refunds, or increase losses.

Can refund be claimed for previous years?

You can claim an income tax refund within 12 months after the end of the relevant assessment year. However, the following conditions will also apply to the tax refund claims: a) You can claim a tax refund on the income tax paid within six successive assessment years.

What is a belated tax return?

A belated return is a return filed after the initial deadline (31st July) but before the extended deadline (31st December of the assessment year). While late filing has consequences, it’s still better than facing potential penalties for non-compliance. The due date to file income tax return for the Financial Year 2022-23 ended on 31st July 2023.

What happens if you file a belated tax return?

“You may be liable to pay a penalty and interest on any tax payable. Also, you can’t revise a belated return once it’s filed.” Furthermore, losses under certain heads of income, such as capital gains and business income, can’t be carried forward to future years if you file a belated return.

Can I claim my tax refund if I file a late return?

You can file a late tax return to claim your refund as long as the return is filed no later than 3 years after the due date of the return. If you have withholdings on your paycheck, there’s a good chance you have a refund due. Even if nothing was withheld from your paycheck, there’s a chance you have a refund due through “refundable tax credits.”

When can I claim a tax refund?

The latest date, by law, you can claim a credit or federal income tax refund for a specific tax year is generally the later of these 2 dates: 3 years from the date you filed your federal income tax return, or 2 years from the date you paid the tax. This time period is called the Refund Statute Expiration Date (RSED).

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