Why you shouldn't miss the July 31 income tax filing deadline

You stand to miss out on a few benefits if you don't file your income tax return on time

The July 31 deadline for filing tax returns is only two days away. If you have not filed your returns yet, you should scramble and do so post-haste as there is a cost attached to not filing your returns on time. 

If you file your return after the due date and later discover that you have made a mistake in the filing, you will not be allowed to revise your filing. The income tax (I-T) department could also penalise you for incorrect filing. 

A tax payer is entitled to carry forward his losses from business or profession, capital losses, etc. This will not be permitted if you miss the July 31 deadline. 

The government pays an interest on any advance tax or tax deducted at source (TDS) that you have paid, or which has been deducted, but is to be refunded to you. If you file your returns late, the period for which the interest is paid gets reduced. 

If you have not paid your tax dues fully, and also file your returns late, the government can levy an interest cost at the rate of 1% per month for the period of delay. 

Low-income earners may also need to file 

If you income is low, you may harbour a few misconceptions about whether you need to file your tax return. Here are a few situations in which you need to do so. 

Suppose that your salary income is higher than the basic exemption limit (Rs. 2.5 lakh). After your investments under Section 80C are included, it comes below the basic exemption limit. In this situation, you do need to file a tax return. 

If a higher TDS has been deducted, you will only be able to get it refunded if you file a tax return.  

If you own a house or possess assets abroad, you need to file your tax return even if your income is lower than the basic exemption limit. 

Even if you had an income earlier but none in the year before, you must still file what is called a "nil return". 

Non-resident Indians (NRIs) who don't have any income in India, but have a property here should file a return as they will be deemed to have rental income from that property. 

Remember that you will need a tax clearance certificate (TRC) if you are going abroad, and this will only be possible if you have filed a return. 

Get all the necessary documents together and then contact your chartered accountant, a tax filing web site, or do the filing yourself. But don't miss out on this all-important deadline under any circumstance.