IN Budget declared on 1 Feb 2018

Government has disallowed  Deductions under Part C of Income Tax if Return not filed on time

 

EARLIER NOW

Return filed on Time

All Deductions Available

Return filed on Time

All Deductions Available

Return filed late

All Deductions Available

except Section 80IA,80IB,80IC,80ID

Return filed late


All Deductions Available except Part C Deductions in respect of Certain Incomes

What are Part C Deductions in Income Tax?

View Answer

Part C of Income Tax  does not cover popular deductions like

  1. Section 80C-Max 150000 deduction on life insurance ,PPF,Housing loan repayment etc),
  2. 80D,(Medical Insurance Premium Deduction)
  3. 80G(Donations to PM Relief fund,_
  4. 80TTA (Savings bank interest deduction) etc

 

So even if return filed late,still Deduction Available under Popular sections like Section 80C,80D,80TTA

 

Earlier

Due Date of ITR is 31 July of next year (30 september for audit cases)

However,Return can be filed late till 31 March

 

 

EXAMPLE

 

For Financial year 2016-17(AY 2017-18

ITR Can be filed till 31 July 2017

However,in case of business,where audit is compulsory,due date is 30 September 2017

However,return can be filed late till 31 March 2018

If return filed late also,still deduction under Section 80C,80D can be claimed

 

 

Now For Financial year 2017-18(AY 2018-19)

ITR Can be filed till 31 July 2018

However,in case of business,where audit is compulsory,due date is 30 September 2018

However,return can be filed late till 31 March 2019

If return filed late deduction under Part C of Income Tax cannot be claimed

hence person has to pay more tax now compared to previous year if he fails to file ITR on time

However,he can still claim Section 80C,80D etc

Normally,Income tax Amendments are applicable from Next Assessment Year 2019-20

However,this Return filed late amendment is applicable from Assessment Year 2018-19

 

Note

Standard Deduction will still be available even if return filed late as it is not covered in Chapter VIA

 

Legal Provision

Government has amended Sectiion 80AC of Income Tax

As per this section

any deduction admissible under section 80-IA or section 80-IAB or section 80-IB or section 80-IC or section 80-ID or section 80-IE, shall be allowed to him only if he furnishes a return of his income for such assessment year on or before the due date specified under sub-section (1) of section 139.


It is proposed to substitute the said section so as to provide that in computing the total income of an assessee of the previous year relevant to the assessment year commencing on or after the 1st day of April, 2018, deduction under any other provisions of Chapter VIA under the heading "C.—Deductions in respect of certain incomes” shall be allowed only if the return is filed within the due date specified under sub-section (1) of section 139.
This amendment will take effect from 1st April, 2018 and will, accordingly, apply to Assessment Year 2018-19

 

 

  1. Tax Practical
  2. Budget Amendments - Changes in 2017-18
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CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 8 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com .