India’s CBDT Extends Corporate Tax Filing Deadline for AY 2024-25

India’s Central Board of Direct Taxes (CBDT) has extended the deadline for corporate taxpayers to file income tax returns for Assessment Year (AY) 2024-25. Initially set for October 31, the new filing deadline is now November 15, 2024.

However, deadlines for crucial tax forms, including the tax audit report, transfer pricing form (Form 3CEB), and Form 10DA, remain firmly set for October 31, 2024.

The Central Board of Direct Taxes (CBDT), which comes under the Department of Revenue, has extended the deadline for corporate taxpayers to file income tax returns for Assessment Year (AY) 2024-25. Initially set for October 31, the new deadline is now November 15, 2024, according to the circular issued by the Ministry of Finance. This extension applies to taxpayers specified under sub-Section (1) of Section 139 of the Income-tax Act, 1961, following a prior adjustment to the deadline for tax audit reports, which was shifted from September 30 to October 7, 2024.

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Under the Income Tax Act, 1961, specific categories of taxpayers are required to undergo an income tax audit to verify the accuracy of their financial statements and ensure compliance with tax regulations. Generally, this audit is due by September 30 each year, with penalties applicable if not filed on time. However, the income tax department has extended the deadline, recognizing the need for additional time due to various factors such as the festive season and potential complexities in the filing process.

Deadlines for essential tax forms remain unchanged for FY 2023-24

For the fiscal year 2023-24, while the overall deadline for filing income tax returns has been shifted to November 15, 2024, the submission deadlines for certain essential tax forms remain unchanged. These include:

• Tax audit report: This report, which taxpayers must file to affirm their accounts meet regulatory requirements, is still due by October 31, 2024. It ensures that the taxpayer’s accounts have been verified by an auditor as per the provisions of the Income Tax Act.
• Form 3CEB (Transfer pricing report): This form is specifically required for taxpayers engaged in international transactions or specified domestic transactions with associated enterprises. It includes details on transfer pricing policies and confirms compliance with transfer pricing regulations. This form remains due by October 31, 2024.
• Form 10DA (Tax deduction for employment of new employees): This form is required for companies claiming a deduction under Section 80JJAA, which allows tax benefits for hiring new employees. The deadline for filing Form 10DA also remains October 31, 2024.

Extension of income tax submission for corporate taxpayers

Tax experts in India have remarked that the CBDT’s extension aligns with the festive season, easing compliance stress during a busy period. The new deadline allows taxpayers and professionals to focus on accuracy without rushing to meet tight timelines during celebrations. The extension provides needed flexibility while supporting timely audit submissions.

This extension affects the following groups:

1. Corporate assessees.
2. Non-corporate assessees whose accounts require auditing under the Income-tax Act or other applicable laws.
3. Partners in firms requiring audits under these laws, along with their spouses in cases where the **Portuguese Civil Code’s Section 5A applies.

Section 5A of the Portuguese Civil Code is applicable in certain parts of India like Goa, Daman, and Diu. Under this section, income earned by a spouse in a marriage is considered joint property, implying that both spouses share ownership of the income equally. 

For tax purposes, Section 5A mandates that any income generated by one spouse is effectively split in half between both spouses. Each spouse is then taxed on their half of the income. This unique tax treatment under the Portuguese Civil Code is distinct from the usual income tax rules in other parts of India, where income is generally attributed solely to the earning spouse.

This provision can also impact tax audit requirements, as both spouses’ incomes are considered for certain tax thresholds and compliance requirements.

Exemptions and penalties for missed deadlines

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The latest extension granted by the CBDT does not apply to tax audit requirements under sections 44AB or transfer pricing audits under section 92CE of the Income Tax Act, 1961.

Tax experts have clarified the penalties for missing the November 15 deadline:

• A fee of INR 5,000 (US$59.47) applies if the taxpayer’s income is INR 500,000 (US$5964.6) or more;
• While others face an INR 1,000 (US$11.89) fee under Section 234F.

Additionally, interest at 1 percent monthly under Section 234A will apply, and taxpayers may lose the ability to carry forward losses to subsequent years under Section 80 of the Income Tax Act.

(US$1 = INR84.08)

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