Get It 00-4 - Reasonable Cause On Application Of Penalties. Income Tax Administrative Hearing

The Underpayment of Estimated Tax by Individuals Penalty applies to individuals, estates and trusts if you don't pay enough estimated tax on your income or you pay it late. The penalty may apply even if we owe you a refund. Find how to figure and pay estimated tax.

Under the Income-tax Act, penalties are levied for various defaults committed by the taxpayer. Some of the penalties are mandatory and a few are at the discretion of the tax authorities. In this part, you can gain knowledge about the provisions relating to various penalties leviable under the Income-tax Act.

25% of the total tax amount due, regardless of any payments or credits made on time.

You may qualify for penalty relief if you demonstrate that you exercised ordinary care and prudence and were nevertheless unable to file your return or pay your taxes on time. Examples of valid reasons for failing to file or pay on time may include: Fires, natural disasters or civil disturbances.

1. Penalty: Late filing attracts a penalty of Rs 5000 for individuals with total income exceeding Rs 5 lakh. For individuals having a total income upto this limit, the penalty is Rs 1000.

Penalty for underpayment of estimated tax Generally, most taxpayers will avoid this penalty if they owe less than $1,000 in tax after subtracting their withholdings and credits, or if they paid at least 90% of the tax for the current year, or 100% of the tax shown on the return for the prior year, whichever is smaller.

A penalty is a form of punishment given for violating a law. In the context of income tax, one shall be penalized if one fails to comply with the rules mentioned in the Income Tax Act,1961. The penalty can either be a fixed amount or a percentage of a certain amount.

False tax return penalty The penalty for filing a false tax return is less severe than outright evasion but it's still enough to make it sting. Individuals may be fined up to $100,000 for filing a false return in addition to being sentenced to prison for up to three years. This is a felony and a form of fraud.