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CA Intermediate · Taxation · Provisions for filing Return of Income and Self Assessment

Sunita Menon, a salaried resident individual (not subject to audit), has total income of Rs 8,00,000 for tax year 2026-27. Tax and cess on total income is Rs 1,20,000. TDS of Rs 70,000 was deducted and advance tax of Rs 20,000 was paid on time. She files her return on 12 October 2027 and pays the balance self-assessment tax with it. Ignoring any interest for default in advance tax, what is the total of interest for late filing and the late filing fee payable by her?

The total is Rs 5,900. Interest is 1% a month on the unpaid Rs 30,000 for three months, being Rs 900, because part of a month counts in full. The fee for late filing is Rs 5,000 since total income exceeds Rs 5 lakh.

  1. ARs 5,600
  2. BRs 5,900Correct
  3. CRs 8,600
  4. DRs 1,900

Explanation

Tax payable after TDS and advance tax = 1,20,000 - 70,000 - 20,000 = Rs 30,000. The due date was 31 July 2027. Interest runs at 1% per month or part of a month from 1 August to 12 October, i.e. 3 months (August, September, October): 30,000 x 1% x 3 = Rs 900. As total income exceeds Rs 5 lakh, the fee is Rs 5,000. Total = Rs 5,900. Counting only 2 months gives Rs 5,600, which is wrong because part of a month counts as a full month.

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