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As per Income Tax laws, the due date to file ITR u/s 139(1) for FY 21-22 (AY 2022-23) was 31 July 2022. Later, a belated return could be filed upto 31 December 2022 for the assesses who missed filing their income tax return within the original due date. Revised returns were also allowed to be filed within this belated return deadline to rectify errors and omissions made while filing the original ITR.
In the Union Budget 2022, the government introduced the ITR U form for updating income tax returns. The ITR-U form is a rescue for those who have not filed their ITR or made inaccurate and false entries while filing their income tax returns.
ITR-U is a form that allows taxpayers to correct errors or omissions on their ITRs up to two years from the end of the relevant assessment year to update their return. For instance, for the assessment year 2021-22, an updated return can be filed by 31 March 2024 if the taxpayers have missed reporting some income.
Irrespective of whether the taxpayer has filed an original, belated, or revised ITR or has completely missed filing the ITR in a specific financial year.
Any taxpayer can furnish an updated return whether he has furnished/not furnished an original return, revised return, or belated return in case of any omission, error, or wrong statement in his earlier return of income.
An Updated Return can be filed if:
The time limit for filing an updated return is 24 months from the end of the relevant assessment year. Hence, in the current financial year 2022-23, updated returns for AY 2020-21 and AY 2021-22 can be furnished.
For example,
Assessment Year | Last Date of Updated ITR Filing |
---|---|
AY (2020-21) | 31 March 2023 |
AY(2021-22) | 31 March 2024 |
AY(2022-23) | 31 March 2025 |
For FY 2019-20 (AY 2020-21), an updated return can be filed by 31 March 2023.
Late filing is always associated with penalties. One would need to pay an additional 25 percent of the tax and interest due on the income missed to be reported if the return is filed within one year from the end of the relevant assessment year. The penalty gets enhanced to 50 percent of additional tax and interest due if the return is filed after one year and within two years of the relevant assessment year.
For example:-
Income Earned in | Action | Penalty Applicable |
---|---|---|
AY 2022-23 | Updated Return filing in between April 1, 2023, and March 31, 2024, (12 months from the end of relevant AY) | 25% of additional taxtax and interest ( if applicable) + Late filing Fees |
AY 2022-23 | Updated Return filing in between April 1, 2024, and March 31, 2025,(24 months from the end of relevant AY) | 50% of additional taxtax and interest ( if applicable) + Late filing Fees |
An Updated Return cannot be filed if:
ITR-U seeks the following additional details from the taxpayers:
Part A - General Information (ITR-U)
This part of ITR-U seeks general information from taxpayers about filing an updated return. It includes the following:
Part B – Computation of updated income and tax payable (ITR-U)
ITR-U can be verified through
Taxpayers get an additional 24 months to file Income Tax Returns even after the deadline for filing the Original ITR, Belated ITR, and Revised ITR has lapsed or passed.
Taxpayers can report any missed out income and pay tax on it, thus reducing the chances of future tax notices and litigations.
Tax Liability and penalty under Updated Return is less than in case of proceedings for undisclosed income or income escaping assessment.
No, if the Updated Return results in a decrease in tax liability, increase in a tax refund, or claim of loss, the taxpayer cannot file an Updated Return.
The due date to file an Updated Return is 24 months from the end of the relevant Assessment Year. Thus, the due date to file an Updated Return in Form ITR-U for AY 2023-24 is 31st March 2026 (2 years from the end of 31st March 2024)
The due date to file an Updated Return is 24 months from the end of the relevant Assessment Year. Thus, the due date to file an Updated Return in Form ITR-U for AY 2022-23 is 31st March 2025 (2 years from the end of 31st March 2023).
A taxpayer can file an Updated ITR only once for a Financial Year. Hence, it should be done carefully.
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