ITR for FY21-22: PAN Card Must For TDS Return, Late Fee Applicable If Not Filed By Deadline

I am a salaried person. Full tax has been deducted on my salary income by my employer. I could not file my income tax return for the financial year 2021-2022 by July 31. What should I do now?

As per the provisions of tax laws, there are two dates as regards filing of your Income tax return (ITR). One is the due date and the other is the last date. July 31, 2022 was the due date by which time you should have filed your ITR for financial year 21-22, as there are various benefits available if you file your ITR by due date. For example, you are allowed to carry forward any loss which cannot be set off during the same year for set off against your income in future only if you file your ITR by due date. 

Last date is the date beyond which you cannot file your ITR. December 31, 2022 is the last date by which you can still file your ITR, which you could not do by the due date i.e. July 31, 2022. Now, you may have to pay interest for delay in filing of your ITR if you file your ITR after the due date, but before the last date. You will also have to mandatorily pay a late filing fee of five thousand rupees while filing the ITR by the last date if your taxable income exceeded five lakhs. However, the mandatory late filing fee shall not exceed one thousand rupees if your taxable income is below five lakhs. 

My brother, who is an NRI, has an NRE (Non-Resident External) account in India. The bank recommended him to take a life insurance policy of their sister company which my brother agreed. My brother does not have a PAN (Permanent Account Number) card.  After mandatory lock in period of five years, my brother surrendered the policy and has received the money from insurance company after tax has been deducted on it on July 4, 2022. After we approached the insurance company we were informed that the tax has been deducted as per the rules and advised us to file his ITR to claim refund of the tax deducted. Now my brother has applied for PAN card. What should we do to claim the refund of the tax deducted?
 
It seems that your brother was missold a ULIP policy. Since the insurance company has deducted tax on it, prima facie it seems the proceeds of insurance policy received by your brother are taxable. For tax deducted, your brother will get the credit if he has PAN and the same has been mentioned by the insurance company while filing its TDS (tax deducted at source) return. As your brother does not have PAN, the insurance company must have filed its TDS return without PAN of your brother. So your brother will not get credit for the tax deducted unless PAN of your brother is updated in the income tax department records in respect of the tax so deducted by the insurance company. Once your brother receives his PAN, he should furnish the same to insurance company and request them to revise the TDS return mentioning his PAN. Once the same is done, the TDS will reflect in his form No. 26AS/AIS (Annual Information Statement). Since the tax has been deducted during the current year, your brother will have to file his ITR to claim the refund for the TDS after end of the financial year 22-23. 

The author is a tax and investment expert.
(Disclaimer: Views expressed are the author’s own, and Outlook Money does not necessarily subscribe to them. Outlook Money shall not be responsible for any damage caused to any person/organisation directly or indirectly.)