CBDT rectifies Income Tax Return Software to remove Error due to incorrect Computation of Interest, Late Fee

Income Tax Dept - ITR software - computation of interest - late fee - Taxscan

The Income Tax Department has rectified Income Tax Return (ITR) software to remove the error due to incorrect computation of interest under Section 234A and late fee under Section 234F of the Income Tax Act, 1961.

“The ITR software was rectified on 1st Aug 2021 itself to remove the error due to incorrect computation of interest u/s 234A and late fee u/s 234F. Taxpayers have been advised to use the latest version of the ITR preparation software or file online,” the Income Tax Department tweeted.

The department has said that if, by any chance, someone has already submitted the ITR with such incorrect interest or late fee, the same will be correctly calculated while processing at CPC-ITR and the excess amount paid, if any, will be refunded in the normal course.

In case the taxpayer fails to file the income tax return within the prescribed time limit, he would be liable to pay late fees for such default as per provisions of section 234F of the Income Tax Act.

Interest under section 234A is levied for delay in filing the return of income. In other words, if the taxpayer files the return of income after the due date specified in this regard, interest under section 234A will be levied. Interest is levied at 1% per month or part of a month. The nature of interest is simple interest. In other words, the taxpayer is liable to pay simple interest at 1% per month or part of a month for delay in filing the return of income.

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