Late filing penalties and interest explained for FY 2026-27

If a taxpayer misses the August 31 deadline, a delayed return can be filed up to December 31, 2026, provided the assessment is not completed earlier. However, late filing may forfeit several benefits, such as the ability to carry forward business or capital losses. Under Section 234F, a delay fee of up to ₹5,000 applies when total income exceeds ₹5 lakh, while a lower fee of up to ₹1,000 is levied for incomes below that threshold. Additionally, Section 234A imposes interest at 1% per month on any outstanding tax.