Income tax is a duty of every person who earns income above a specific level of income earning. The government has set out income bands to assess tax amount and filing an Income Tax Return (ITR) is compulsory. But often individuals get confused whether they can go to jail for not filing the ITR or even might be illegal. Let us look at some of the most important rules around income tax and ITR.
Consequences of Tax Evasion
If a person conceals his income and fails to pay the necessary tax, then such move is considered as tax evasion. As per the provision under Section 276C of the Income Tax Act, the department can go ahead with stringent action in the manner of and even fine or imprisonment. It should be noted that the wilful default in paying taxes is unlawful and is prohibited by the law.
What Will Happen to Me If I Have Not Filled My ITR?
Failure to file the ITR on time is also unlawful Click here to read more about Law. As per Section 276CC of the Income Tax Act 1961Income Tax Department may impose penalty where returns where remain pending for a long time. Apart from finespersistent failure to observe the laid down requirements can result in legal proceedings. Criminalgrievous cases leading to serious violations call for imprisonment even though jail is rarely given in such circumstances.
Delay in TDS Deposit
TDS has to be deposited in a particular period for the same it is mandatory for being into effect Tax Deducted at Source. If there is any delay, the department can launch a legal process through section 276B Income Tax Act. In such cases, it may be obligatory to pay interest and fines on the difference in the amounts, as a result of which the composition of the indemnity is changed. Non-compliance could also trigger a court case and this case could lead to jailing.
Income Tax rules and exemptions
At the moment if an individual’s income is less than ₹7 lakhs per yearone can opt for no income tax in the latest scheme. But every Indian has to file ITR whether he is earning or not. Failure of the implementation of all or any of the recommendations could attract an action by the department at any time.
Possibility of Rule Changes
Some proposals have been made with regards to this, and the Finance Minister has said that some provisions may be relaxed. Nevertheless, there are no signed decisions to that effect at this time.
