Due Date for Furnishing Return of Income for AY 2024-25
Due Date for Furnishing Return of Income for AY 2024-25 The Central Board of Direct Taxes (CBDT) has granted an extension for the due date for filing the Return of Income for the Assessment Year (AY) 2024-25. This extension is specifically applicable to assessees who are required to furnish a report under Section 92E of the Income-tax Act, 1961, concerning transfer pricing. In this blog post, we’ll explore the details of this extension, its implications, and answer some frequently asked questions (FAQs) to help you better understand the update.
What is Section 92E of the Income-tax Act?
Section 92E of the Income-tax Act requires businesses, particularly multinational corporations (MNCs), to submit a Transfer Pricing Report. The report ensures that the pricing of international transactions between related parties follows the arm’s length principle, meaning the transactions are priced as if they were between unrelated parties.
This report is crucial for businesses engaged in cross-border transactions, including the sale of goods, services, intangibles, loans, or other financial arrangements between associated enterprises. Due Date for Furnishing Return of Income for AY 2024-25 The objective is to prevent tax evasion or avoidance through manipulation of pricing between related entities in different tax jurisdictions.
https://www.incometax.gov.in/iec/foportal/
The CBDT Notification: Extension of Due Date for AY 2024-25
Due Date for Furnishing Return of Income for AY 2024-25 In a recent notification, the CBDT has extended the due date for filing the Return of Income for the Assessment Year 2024-25 for assessees who are required to file a Transfer Pricing Report under Section 92E.
Key Points of the Extension:
- Original Due Date: 30th November 2024
- Extended Due Date: 15th December 2024
- Who is Affected: Due Date for Furnishing Return of Income for AY 2024-25 The extension applies to assessees required to submit a Transfer Pricing Report under Section 92E for cross-border related-party transactions.
This extension provides businesses and professionals more time to prepare the necessary documentation and ensure compliance with complex transfer pricing rules.
Why Was the Due Date Extended?
The extension was granted to accommodate the challenges businesses face when preparing transfer pricing documentation, especially for multinational corporations involved in complex international transactions. Due Date for Furnishing Return of Income for AY 2024-25 Preparing a Transfer Pricing Report requires thorough documentation, financial analysis, and the application of transfer pricing methodologies, which can be time-consuming.
The CBDT’s decision is in response to feedback from industry stakeholders and tax professionals, who highlighted the difficulties of meeting the original due date given the complexity of preparing such reports.
Impact on Assessees: What Does This Mean for Taxpayers?
For businesses and professionals, this extension offers several benefits:
- Additional Time for Compliance: Due Date for Furnishing Return of Income for AY 2024-25 The 15-day extension allows more time to complete the Transfer Pricing Report, ensuring that it meets the legal and technical requirements set by the tax authorities.
- Reduction of Risk: With more time to prepare, taxpayers reduce the likelihood of errors or incomplete documentation, which could lead to penalties or scrutiny by the tax authorities. Due Date for Furnishing Return of Income for AY 2024-25
- Avoidance of Penalties:Due Date for Furnishing Return of Income for AY 2024-25 Filing the return after the due date without an extension can attract penalties. This extension reduces the risk of late filing penalties under Section 271F, which can impose fines of up to ₹5,000 for late submission.
- Impact on Tax Professionals: Chartered Accountants, Transfer Pricing experts, and other tax professionals who assist businesses with compliance will benefit from the additional time to ensure that all documents are in order before submission. Due Date for Furnishing Return of Income for AY 2024-25
Who Is Eligible for the Extended Due Date?
This extension applies to assessees who are required to submit a Transfer Pricing Report under Section 92E of the Income-tax Act, 1961. This typically includes businesses involved in international transactions with related parties, where the value of transactions exceeds specified thresholds.
It is important to note that this extension does not apply to taxpayers who do not have transfer pricing obligations. For such taxpayers, the usual filing deadlines continue to apply.
Key Dates
- Original Filing Deadline: 30th November 2024
- Extended Filing Deadline: 15th December 2024
Frequently Asked Questions (FAQs)
- Who is eligible for the extended filing deadline?
The extended filing deadline of 15th December 2024 applies only to assessees who are required to submit a Transfer Pricing Report under Section 92E. These are typically multinational corporations or businesses involved in international transactions with related parties.
- What is a Transfer Pricing Report?
A Transfer Pricing Report is a document that provides detailed information on the pricing of international transactions between related entities. The report is intended to demonstrate that these transactions are priced according to the arm’s length principle, i.e., as if they were between unrelated parties. This report is a critical part of tax compliance for multinational enterprises.
- Why was the filing deadline extended?
The CBDT extended the deadline to provide more time for businesses and tax professionals to prepare the Transfer Pricing Report. The process of gathering data, preparing financial analyses, and ensuring compliance with transfer pricing laws is complex and time-consuming, particularly for multinational companies.
- What are the consequences of filing late without this extension?
If an assessee fails to file the Return of Income on time without an extension, they could face penalties under Section 271F of the Income-tax Act. Due Date for Furnishing Return of Income for AY 2024-25 The penalty can be up to ₹5,000 for late filing. Additionally, interest charges under sections 234A, 234B, and 234C may apply if the tax payable is not deposited on time.
- What should I do if I am eligible for the extended deadline?
If you are eligible for the extension, ensure that you use the additional time to review and finalize your Transfer Pricing Report. Consult with your tax professionals or Chartered Accountants to ensure that all documentation is in order before the new deadline of 15th December 2024.
- Can the due date be extended again?
The current extension applies only for the AY 2024-25 and is unlikely to be further extended unless explicitly stated by the CBDT. Taxpayers should aim to meet the revised deadline and avoid relying on further extensions.
- What if I don’t need to submit a Transfer Pricing Report?
If you do not need to submit a Transfer Pricing Report under Section 92E, you must adhere to the standard filing deadlines for the Return of Income for AY 2024-25. The extension only applies to those with transfer pricing obligations.
- Will the extension apply to all types of assessees?
No, the extension applies only to assessees who are required to file a Transfer Pricing Report under Section 92E. Due Date for Furnishing Return of Income for AY 2024-25 Other assessees without such obligations are not eligible for the extended deadline and must file their returns by the usual due date.
Conclusion
The CBDT’s decision to extend the due date for filing the Return of Income for AY 2024-25 is a significant relief for assessees required to submit a Transfer Pricing Report. Due Date for Furnishing Return of Income for AY 2024-25 This extension provides additional time to ensure accurate documentation and compliance with complex transfer pricing laws. Businesses and tax professionals should take this opportunity to thoroughly review and finalize their reports before the revised deadline of 15th December 2024.
For those eligible for this extension, it is crucial to consult with your tax advisors and ensure that all compliance requirements are met. Due Date for Furnishing Return of Income for AY 2024-25 Timely and accurate filing of the return will help avoid penalties and ensure that businesses remain compliant with India’s transfer pricing regulations.
If you have any more questions or need assistance with transfer pricing compliance, feel free to reach out!
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