What is Section 234F?

Section 234F of the Income-tax Act, 1961 imposes a fee when a person who is required to file an Income-tax Return does not file it within the due date prescribed under section 139(1).

The amount is commonly referred to as a penalty for late filing. Legally, however, section 234F describes it as a fee for default in furnishing the return of income, rather than a penalty.

For Assessment Year 2026-27, the late-filing fee continues to be governed by the Income-tax Act, 1961 even where the return is filed after the Income-tax Act, 2025 came into force on 1 April 2026.

Amount payable under Section 234F

The late-filing fee depends on the taxpayer's total income:

The standard fee is ₹5,000. However, where the taxpayer's total income does not exceed ₹5 lakh, the fee cannot exceed ₹1,000.

Who is liable to pay the late-filing fee?

The fee may apply where a person:

1. is required to furnish an Income-tax Return under section 139
2. fails to file the return within the applicable due date under section 139(1)
3. subsequently files a belated return

It may apply to different categories of taxpayers, including:

• individuals
• Hindu Undivided Families
• firms and Limited Liability Partnerships
• companies
• Associations of Persons
• trusts
• other persons who are legally required to file a return

The applicable return due date depends on the taxpayer's category, whether the accounts require an audit, whether transfer-pricing provisions apply and whether the Government has notified an extension.

Is the fee payable when income is below the basic exemption limit?

Section 234F applies where a person is required to furnish a return but fails to file it within the prescribed time.

Therefore, merely filing a voluntary return after the due date does not automatically establish liability under section 234F. It is first necessary to determine whether the person was legally required to file a return under section 139.

A person may still be required to file an ITR even where income is below the basic exemption limit. This may happen because of:

• specified high-value transactions
• holding a foreign asset
• having signing authority in a foreign account
• incurring expenditure above prescribed limits
• another mandatory filing condition under the Income-tax Act

Example 1: Total income below ₹5 lakh

Suppose an individual was required to file an ITR for AY 2026-27 within the applicable due date but filed the return late.

The person's total income is ₹4,80,000.

The reduced fee applies because the total income does not exceed ₹5 lakh.

Example 2: Total income above ₹5 lakh

Suppose a taxpayer with total income of ₹8,50,000 files the return after the applicable due date.

The fee may apply even where the taxpayer has already paid the entire income-tax liability.

Example 3: No outstanding tax but return filed late

A salaried person has sufficient tax deducted by the employer and is entitled to a refund. However, the person files the return after the due date.

Section 234F may still apply because the fee is linked to the delay in filing the return and not merely to the existence of unpaid income tax.

Consequently, the late-filing fee may reduce the amount of refund otherwise receivable.

Section 234F fee and interest under Section 234A

The late-filing fee under section 234F and interest under section 234A are separate consequences.

Depending on the facts, a taxpayer may be liable for both the fee under section 234F and interest under section 234A.

Payment of the section 234F fee does not eliminate the liability to pay tax, interest or any other amount applicable under the Income-tax Act.

How is the Section 234F fee paid?

The fee is generally calculated while preparing the belated return and forms part of the total amount payable before submission.

Taxpayers should:

1. compute the total income-tax liability
2. include applicable interest under sections 234A, 234B and 234C
3. include the fee payable under section 234F
4. adjust available TDS, TCS, advance-tax and self-assessment-tax credits
5. pay any remaining amount through the prescribed tax-payment facility
6. enter or verify the challan details in the return before filing

The return-filing utility may calculate the fee automatically based on the filing date and the information entered. However, the taxpayer should verify the computation before submitting the return.

Can the Section 234F fee be waived?

Section 234F does not provide a general automatic waiver merely because:

• the taxpayer had no tax payable
• sufficient TDS had already been deducted
• the taxpayer was entitled to a refund
• the delay was unintentional
• the return was filed only a few days late

Relief may be available only where the law, a valid CBDT order, a notified relaxation or an appropriate condonation mechanism applies to the particular circumstances.

Other consequences of filing a belated return

Apart from the fee under section 234F, late filing may have other consequences:

• interest may become payable under section 234A
• certain losses may not be eligible to be carried forward
• deductions or exemptions requiring filing within the due date may be affected
• a refund may be delayed
• the time available to revise the return may become shorter
• the taxpayer may need to use an updated-return or condonation mechanism if the belated-return deadline has expired

Section 234F under the Income-tax Act, 2025

The Income-tax Act, 2025 came into force on 1 April 2026. However, it does not govern returns relating to income earned up to 31 March 2026.

The corresponding late-filing provision under the Income-tax Act, 2025 is section 428.

Section 428 retains the same fee structure:

• ₹1,000 where total income does not exceed ₹5 lakh; and
• ₹5,000 in every other case.

The change is primarily one of restructuring and section numbering. There is no substantive change in the amount of the late-filing fee.

Which Act applies during the transition?

A return for FY 2025-26 remains governed by the Income-tax Act, 1961 even where it is physically filed during FY 2026-27. The filing date does not, by itself, change the legislation applicable to that income period.

Common misunderstandings

There is no fee because all tax has already been paid

This is incorrect. The section 234F fee is imposed for delayed filing and may apply even where no income tax remains payable.

The maximum fee is still ₹10,000

This is incorrect under the current provision. The maximum fee is ₹5,000. The reduced maximum is ₹1,000 where total income does not exceed ₹5 lakh.

The Income-tax Act, 2025 applies to every return filed after 1 April 2026

This is incorrect. Returns for FY 2025-26 and earlier periods continue to be governed by the Income-tax Act, 1961.

Section 234F and Section 234A are the same

This is incorrect. Section 234F imposes a fixed fee, while section 234A imposes interest for delay where its conditions are satisfied.

A person below the exemption limit can never be required to file an ITR

This is incorrect. A filing obligation may arise because of specified transactions, foreign assets or other statutory conditions, even where income is below the ordinary exemption threshold.

Practical takeaways

• File the return within the applicable due date under section 139(1) or section 263, as relevant.
• Do not confuse the late-filing fee with interest on unpaid tax.
• Check whether the ₹1,000 or ₹5,000 limit applies based on total income.
• Verify whether the taxpayer was legally required to furnish a return.
• Pay the applicable tax, interest and late-filing fee before submitting the belated return.
• For FY 2025-26 and AY 2026-27, apply section 234F of the Income-tax Act, 1961.
• For Tax Year 2026-27 onwards, refer to section 428 of the Income-tax Act, 2025.

Conclusion

Section 234F imposes a fixed fee where a person who is required to furnish an Income-tax Return fails to file it within the applicable due date. The fee is limited to ₹1,000 where total income does not exceed ₹5 lakh and ₹5,000 in other cases.

For AY 2026-27 and earlier years, section 234F of the Income-tax Act, 1961 continues to apply. From Tax Year 2026-27 onwards, the corresponding provision is section 428 of the Income-tax Act, 2025.

Although the provision has been renumbered under the new Act, the amount of the late-filing fee remains unchanged.

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