Filing ITR in September? Don’t Assume Your Tax Liability Is Postponed
Filing ITR in September? Don’t Assume Your Tax Liability Is Postponed
A large population of taxpayers got big relief when the Income Tax Department extended the due date for filing the income tax return (ITR) for the financial year 2024-25 (assessment year 2025-26) until September 15, 2025. Earlier, the deadline was July 31, 2025. This extension is done for the taxpayers who are not liable for income tax audits. These individuals include salaried individuals, NRIs and pensioners.
Taxpayers should note that interest mentioned under Section 234A of the Income Tax Act is only applicable when the ITR is filed after the due date set by the Income Tax Department, as mentioned under Section 139(1) and when the self-assessment tax is not paid by that due date. However, since the ITR due date for FY 2024-25 (AY 2025-26) has been extended till September 15, 2025, this new date will be treated as the official due date for Section 234A.
Therefore, if you pay all your tax dues and file your return by September 15, 2025, no penal interest under Section 234A should be charged. To support his point, we have judgement of Supreme Court judgement titled CIT vs. Prannoy Roy and a CBDT circular from 2015, which agreed with the Court’s decision.
Since the due date for filing the income tax return (ITR) has been extended till September 15, 2025, interest under Section 234A (for late filing) should not be charged if you file your return and pay all your self-assessment tax before or on this new deadline.
Previously, even when deadlines for ITR filing were extended, the Central Board of Direct Taxes (CBDT) often said that such extensions would not be applied to the purposes mentioned in Section 234A of the Income Tax Act, and interest would still apply from the original due date. However, in the latest circular (No. 6/2025), there is no such mention. Since this extension has taken place because of reasons outside the taxpayer’s control, it is fair to say that no Section 234A interest should be charged if the return is filed by September 15, 2025.
If a taxpayer files his/her ITR after the due date (September 15, 2025 or FY 2024-25) and also pays the self-assessment tax after the same deadline, then the taxpayer becomes liable to pay interest on the self-assessment tax due u/s 234A.
Many taxpayers have a question: Will penal interest be applicable on the tax u/s 234B and 234C? So the answer to that question is Yes, penal interest will apply if advance tax is not paid on time or in full for the financial year 2024-25 (assessment year 2025-26). Taxpayers must pay advance tax in instalments. If they don’t, they may have to pay extra interest as a penalty.
- Section 234B of the Income Tax Act says that if a taxpayer doesn’t pay the complete amount of advance tax by the end of the financial year, penal interest will be charged.
- Section 234C of the Income Tax Act says that if the taxpayer doesn’t pay the complete required amount of advance tax, penal interest will be charged.
Therefore, to avoid this extra interest, it’s important to pay the correct amount of tax on or before the due dates.