State-Specific Late Fee Provisions

• The late fee for professional tax return filing varies from state to state, as professional tax is governed by individual state legislations.
  
• Each state prescribes its own fixed penalty or daily fee for delayed filing of returns.
  
• These charges apply in addition to interest on delayed tax payment, if applicable.
  
• The fee is generally non-waivable unless relaxed under specific government schemes.
  
• It is levied separately from the tax amount and must be paid before return acceptance.
  

Fixed Late Filing Fees

• Many states impose a fixed fee per delayed return.
  
• For example, some states charge a flat ₹300 to ₹1,000 for each late return.
  
• The amount may differ depending on whether the return is monthly, quarterly, or annual.
  
• Returns submitted after the due date, even by one day, trigger the full fee.
  
• The fixed late fee is mandatory and auto-calculated in most state portals.
  

Per Day Delay Charges

• Some states also charge a daily late fee, in addition to or instead of a fixed penalty.
  
• The daily amount may range from ₹5 to ₹50 per day depending on state law.
  
• The fee accrues from the day after the due date until the return is filed.
  
• This can lead to a substantial cumulative penalty for prolonged delays.
  
• Maximum capping may apply, but not in all cases.
  

Combination of Penalty and Interest

• States often impose interest on unpaid tax along with late filing fees.
  
• Interest is typically charged at 1% to 2% per month on the tax amount.
  
• Therefore, late compliance results in both interest and late fee liabilities.
  
• Both charges must be settled before the return is processed.
  
• This ensures complete resolution of the default.
  

Effect on Compliance and Audit Records

• Frequent late filings affect the taxpayer’s compliance rating and audit risk profile.
  
• Late filing history may be cited during inspections, assessments, or renewal of licenses.
  
• Timely filing helps avoid unnecessary financial and legal consequences.
  
• Businesses are advised to set up reminders or automated systems for return filing deadlines.
  
• Maintaining a clean filing record supports smoother government interactions and approvals.