Taxpayers who do not file their Income Tax Returns (ITRs) on time will have to shell out a penalty of upto Rs 10,000, but from the 2018-19 Assessment Year (AY). However, in a case where the total income does not exceed Rs 5 lakh, the Budget proposed that the fee amount shall not exceed Rs 1,000.
In order to ensure that return is filed within due date, it is proposed to insert a new section 234F in the Act (I-T Act) to provide that a fee for delay in furnishing of return shall be levied for assessment year 2018-19 and onwards in a case where the return is not filed within the due dates specified for filing of return under sub-section (1) of section 139. Individuals having taxable income up to Rs 5 lakh can just fill up a simple one-page form for filing their tax returns. When too many people evade taxes the burden of their share falls on those who are honest and compliant. We are now tightening our noose around tax evaders and that money is coming to exchequer, so we are trying to reward the honest tax payers. In the Budget for 2017-18, the government has sought to lower the tax burden on small tax payers with income in the lowest slab of Rs 2.5-5 lakh by halving their tax rate to 5 per cent. To ease the compliance burden on small traders, Jaitley also proposed to increase the threshold limit for audit of business entities who opt for presumptive income tax scheme from Rs 1 crore to Rs 2 crore. Presenting data before the Lok Sabha, Jaitley yesterday said that in terms of individuals, the number of Indians with a declared annual income above Rs 50 lakh stands at a paltry 1.72 lakh, while only 24 lakh people show income above Rs 10 lakh.Among the 3.7 crore individuals who filed the tax returns in 2015-16, 99 lakh show income below the exemption limit of Rs 2.5 lakh p.a., 1.95 crore show income between Rs 2.5 to Rs 5 lakh, 52 lakh show income between Rs 5 to Rs 10 lakhs and only 24 lakh people show income above Rs 10 lakhs. Of the 76 lakh individual assesses who declare income above Rs 5 lakh, 56 lakh are in the salaried class. The number of people showing income more than Rs 50 lakh in the entire country is only 1.72 lakh.