• Notification Date: 10-01-2024
• Notification No: N/A

Assessment Year 2024 likely to see a Projected 20% fall in late-filed ITR: SBI Report

The total number of persons filing Income tax increased to 74 million in the assessment year 2022-23 (AY23) from 70 million in AY22, State Bank of India researchers said in a new report released Friday.  

Recently, the income tax department provided a breakdown of the individual taxpayers’ returns filed across different categories of gross total income. It stated that between AY14 and AY22, the number of individual taxpayers earning between Rs 5 lakh and Rs 10 lakh surged by 295%, signalling a notable shift towards higher gross total income brackets. Additionally, those earning between Rs 10 lakh and Rs 25 lakh saw a 291% increase. Overall, the number of individuals filing income tax rose to 74 million in AY23 from 70 million in AY22. 

For AY24, 82 million ITRs have been filed till December 31, and another 5-8 million returns are expected to be filed in the remainder of the financial year till March, thereby taking the total number over 85 million, around 37% of the formal labour force.  

“For AY24, we believe the share of IT returns filed after the due date may drop to around 20%. This reveals the discipline among taxpayers along with the simplification of IT forms and processes driven by constant efforts of CBDT to build an efficient, digital-heavy filing, verification and return architecture sans hassles,” states the report.  

The SBI report, which analysed tax return data, said inequality, measured by the Gini coefficient, dipped during FY14 and FY22, noting that 36.3% of people belonging to the lowest income group in FY14 have since moved up the income ladder.  

In AY 2015 (Financial Year 2014), data indicates significant upward mobility among individual ITR filers within various income groups. As mentioned above, notably, 36.3% of those initially in the less than Rs 3.5 lakh income bracket have transitioned to higher income segments. Specifically, 15.3% moved to both the Rs 3.5 lakh to Rs 5 lakh and Rs 5 lakh to Rs 10 lakh brackets, while 4.2% shifted to the Rs 10 lakh to Rs 20 lakh bracket, with the remainder progressing further upwards.   

Within the lowest income group, lower than Rs 4 lakh, a substantial 21.1% of the gross income has ascended to higher brackets, delineated as 6.6% towards the Rs 4 lakh to Rs 5 lakh group, 7.1% to Rs 5 lakh to Rs 10 lakh, 2.9% to Rs 20 lakh to Rs 50 lakh, and 0.8% to the Rs 50 lakh to Rs 1 crore group.