Section 234F of Income Tax Act

Everyone who earns a living in India is taxed. Completion of income tax returns is mandatory under Section 234f of the Income Tax Act. Failure to submit the income tax returns will result in penalties. According to the Income Tax Act, people earning ₹ 2.50 Lakh are subject to tax. Given that, every citizen is expected to file their taxes at the end of each financial year. Taxpayers include details about their income, tax exemptions who may be eligible for a rebate, who may be eligible for tax refunds. Section 234f is basically a penalty law for defaulters.

A few years ago, there were no negative consequences of failing to file your tax in the stipulated time. But the situation has changed with the changes introduced in section 234f of the 2017 Income Tax Act. If you are unable or fail to pay the tax within the due date, you are liable to charge a fine under the provisions of this Act. Note that the deadline for submitting an ITR for the 2020-21 testing year has been extended to 10 January 2021. You will be liable under this Act if you do not do the following.

  • Enter the tax code within the deadline set out in terms of Section 139.
  • File your income tax late or not at all.

It is important to remember that this clause applies to all categories of people such as firm, company, individual, BOI, HUF, AOP, and so on, only if tax returns have not been lodged within a given date. Also, the main reason for using section 234f was to ensure that people paid their taxes on time.

Penalty for Late Filing u/s 234FSection 234F of Income Tax Act

As mentioned earlier, failure to file income tax returns on time attracts penalties and costs us 234f. This law has been made binding on 1 April 2017. Filling in the income tax after the expiration date may attract a fine of up to ₹ 10,000. In addition, if you apply for income tax after January 10, 2021, but before March 31, 2021, you will be charged ₹ 10,000. The Department of Taxes has come up with an exemption for small taxpayers, earning less than ₹ 5 Lakh. For these taxpayers, the maximum tax charged is no more than ₹ 1,000. You can read the table given below for a better understanding.

TR Penalty Details
Date Of Filing Net Income Lower Than ₹ 5 Lakh Net Income Higher Than ₹ 5 Lakh.
Up to January 10, 2021 0 0
From January 10, 2021, to March 31, 2021 ₹ 1,000 ₹ 10,000

Reduced Time for Revising Your Return

You may have made a mistake while inserting the tax for the amount that needs to be amended. Subject to the new regulations of section 234f of the Income Tax Act, you are entitled to make adjustments until the end of the applicable year of inspection. Prior to the new provision, taxpayers had two years to make changes and refinements. But after the suspension of the new provision, the re-delivery window has been reduced to one year i.e, from the end of the financial year. However, there is no limit to the number of times you can file a tax return.

You can choose to add amendments to the original form or select a new form to apply the change. After submitting the change, it becomes legal, and the past is not considered valid. However, you can only file for review if previous wrong records were accidentally inserted.

Be aware that it is important to put your taxes in the first place, because the sooner you file taxes the more time you have to make changes if there are mistakes

Payment of Interest in ITR Late Filing

In terms of the provisions of section 234f of the Income Tax Act, if you fail to file a tax return or within the prescribed period, you will be liable to pay an interest rate at 1% interest on a monthly basis, excluding normal costs. The interest rate calculation is based on the last date to lodge refunds until the date on which the refund is actually lodged by you. The more you defer tax, the more interest you will have to pay in addition to the normal tax deduction.

Delay in Revealing Funds 234f Income Tax

You may have paid more tax and are working to get a refund from the government. Therefore, it is important that the money is paid by the government. To get a refund, you must submit a refund form. If you apply for an immediate refund, you will receive a refund immediately.


✅ What is Section 234f?

Section 234f of income tax imposes a fine on a person who has failed to pay tax by the due date of the financial year. According to the new regulations under this Act, you are now obliged to pay your income tax on time or you will be liable for a fine of up to ₹ 10,000. Just call Dialabank to understand the procedure more clearly at 9878981144.

✅ Is 234f applicable for nil return?

Under the new Section 234f provision, you will not be liable for a fine if your income is below the exemption limit or if the refund is not available. The law is enforced only if your income is more than ₹ 25,000 per month.

✅ How do I pay late fees for ITR?

The ITR late payment process is similar to the process for submitting income tax returns. If so, you missed the submission of your tax returns.

✅ What if I have not filed a tax return?

Under the new section 234f of income tax regulations, it is mandatory to submit your return forms within or before the due date. If you forget to submit your tax returns on time you will have to pay a fine of up to ₹ 10,000, plus 1% interest rate from the due date to the tax return date.

✅ Does the IRS forgive tax debt after 10 years?

The Internal Revenue Service usually has ten years on hand to collect taxes that remain unpaid. However, at the end of ten years, tax debts are fully waived and cleared of taxpayer records. This IRS provision is unpopular with taxpayers as it will provide potential taxpayers a way out of paying their taxes on time.