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What happens if a person does not file the Income Tax Return by the due date You have to Pay Interest on Income Tax Due if you don’t file on time If you do not file the Income Tax Return by the due date: You are liable to pay interest at the rate of one percent for every month after the due date till the date of filing the return. If No Tax is due: Interest is calculated on the amount of tax payable after adjustment of pre-paid taxes like advance tax, TDS etc. So, if there is no tax payable on the basis of the Income declared in the Tax Return, there is no liability for the payment of interest. You don’t get the benefit of Carry Forward of Losses if you don’t file on time Under income tax law, if you have sustained a Business loss or loss under the head “Capital Gains”, you can carry forward the loss ONLY if you file the Income Tax Return by the due date. Therefore, if you have sustained a loss, you must file your Income Tax Return in time if you want to carry forward the ...