• Income tax queries

Hi- Good day. 
1>>
I want to know, can someone pay tax this year which he or she forgot to pay last year and mention it in current year ITR . For example someone forgot to pay tax On Bank Interest earning. The last year's ITR was processed successfully. Instead of modifying last year ITR can it be mentioned in current year's ITR after paying proper due tax. Is it possible.

2>>
FY-16-17 ITR was submitter last year. But even after 15 months it is not processed. It has got Income Tax Audit under section 44AB .
We raised grievance and got reply that it is still under processed. Is it normal. Will they pay interest on refund amount.

Thank you
Asked 1 year ago in Income Tax from odisha, Odisha

Hi,

Hope you are doing well !

Please find below the replies:

1. Yes,it is possible. You can pay last year tax outstanding in current year subject to followings:

Section 245 gives powers to the Income Tax Department to adjust any previous year’s demand of tax payable with the current year’s refund. But to exercise this power, it’s mandatory on their part to send intimation u/s 245 to the taxpayers and give them opportunity to submit their response on it whether they agree with it or not.

In other words, if you owe income tax department, then they will adjust the amount you owed in the current year’s refund. But before adjusting that amount they will send you a notice u/s 245, stating that they are adjusting your refund with the previous years outstanding amount. You have to submit your response on it that whether you agree with department or not.

NOTE: The outstanding amount will be adjusted when refund is generated. That means even if the refund generated after 5 years, the refund will be adjusted then.

*Better to revise the previous return and pay the outstanding tax with interest.

2.Yes, It is normal under tax processing.They will pay interest on refund amount.

Thanks & Regards,

Payal Chhajed

Payal Chhajed
CA, Mumbai
3244 Answers
41 Consultations

5.0 on 5.0

Dear Sir,

1) You can revise the last year ITR i.e. A.Y. 2017-18. The last date for revision is 31.03.2019. I think it would be saving bank interest.

2) It is not of F.Y. 2016-17, it is A.Y. 2016-17 i.e. F.Y. 2015-16. Yes it is normal for ITR processing. Yes they will pay interest on refund amount.

Thanks

Vivek Kumar Arora
CA, Delhi
3221 Answers
166 Consultations

5.0 on 5.0

Hi

1. It is advisable to revise the previous return and pay the due taxes with interest.

2. Although it's not normal, but it can be late as time limit for such processing is upto 31st March 2019.

Yes, interest shall be paid on refund.

Lakshita Bhandari
CA, Mumbai
3848 Answers
190 Consultations

5.0 on 5.0

Hi

1. In this case, you can revise the previous years return and pay the taxes with interest.

2. Normally it does not take so long. However, interest will also be paid on the refund amound.

Hope that clarifies.

Reagrds,

Nikhil.

Nikhil Khanna
CA, Mumbai
1428 Answers
19 Consultations

4.8 on 5.0

1) No Dear.

2) IF their is any refund, you will surely get interest on that.

Chirag Maru
CA, Raipur
180 Answers

5.0 on 5.0

hi,

1) it wont help.you only option is to file revised your return and pay additional taxes.

I would suggest leave it as of now.

2) yes , they do.

Vishakha Agarwal
CA, Bangalore
448 Answers
78 Consultations

5.0 on 5.0

1. No it is not possible to mention it in the current year. You will have to revise the last year's return.

2. Yes, it's normal. In some cases, ITR processing takes time. It can process at any time before 31 March 2019.

Abhishek Dugar
CA, Mumbai
3576 Answers
173 Consultations

5.0 on 5.0

Reply to Q.1

Statutorily, income earned in a particular year needs to be offered to tax for that particular year only (and not in some other year). In case the ROI has been filed and the same processed, but if time for filing a revised ROI is pending, then the assessee should file a revised ROI.

Reply to Q.2

Sometimes, the processing of ITR practically takes time. It would be advisable to wait till the statutory time line for issue of tax scrutiny notice expires and then file a e-nivaran request on the e-filing website requesting the jurisdictional AO to issue income tax refund alongwith interest u/s 244A of the Income-tax Act 1961 (i.e. at the rate of 6% p.a.).

Sanket Suresh Shah
CA, Mumbai
29 Answers

5.0 on 5.0

Hello Sir/ Mam,

Reply to your queries are:

1. In case you forgot to show your bank interest income in the last year's income tax return and also forgot to pay tax, then you have to revise you last year income tax return. There is no such provision of showing last year's income in current years income tax return.

2. Sometime for various reasons department took more than the usual time to assess an income tax return. So, there is no need to worry about that.

Department is liable to pay interest only when they delayed the payment of Refund. In your case assessment is under process and amount of refund is not certified by the department. so they are not liable to pay interest on that.

In case you need any other help, feel free to ask.

Thanks & Regards

CA Divya Chugh

Divya Chugh
CA, Delhi
95 Answers
1 Consultation

5.0 on 5.0

1>> You can. But it is always advisable to offer the Income in the Year in which it is earned.

2>> Time limit to process an Income Tax Return u/s 143(1) is one year from the end of the financial year in which the Return is filed. You would have filed the ITR for FY 2016-17 in FY 2017-18. Hence, as per law, the IT Dept has time till 31-Mar-2019 to process your ITR. So, kindly wait for the Return to be processed!

Yes. IT Dept has to pay Interest at 0.5% per month u/s 244A for delayed refund

Pradeep Bhat
CA, Bengaluru
477 Answers
39 Consultations

5.0 on 5.0

Hi

If you forgot to pay tax on bank interest (assuming it was > 10k) then to avoid further litigation you must pay tax along with interest, while making payment please select the correct AY for which you are making payment. Don't show such income in current year, once any notice or demand will arise then you can show such challan and safe guard yourself.

Dont worry about processing of this it can take some time, but I don't understand how you are calculating 15 months.

hope it will be helpful

Varun Chawla
CA, Ghaziabad
72 Answers

5.0 on 5.0

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