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Updated Return - Form ITR-U

Updated on: 16 Sep, 2022 12:10 PM

What is an Updated ITR?

Section 139(8A)of the Income Tax Act allows taxpayers who later realize that they failed to record any income have a chance to update their return or file a fresh return in case no return was filed earlier, up to two years from the end of the relevant assessment year. The assessee needs to disclose only the amount of additional income, under the prescribed income heads, on which additional tax is required to be paid. New ITR Form “ITR-U” has been introduced for filing of such updated return of income.

Who is Eligible to File Form ITR-U?

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 :
  • Return previously not filed
  • Income not reported correctly
  • Wrong heads of income chosen
  • Reduction of carried forward loss
  • Reduction of unabsorbed depreciation
  • Reduction of tax credit u/s 115JB/115JC
  • Wrong rate of tax

Is there any requirement to pay any additional tax?

An additional 25 percent on the tax due is to be paid if the Updated ITR is filed within 12 months, while the rate will go up to 50 percent if it is filed after 12 months, but before 24 months from the end of relevant Assessment Year. Hence, taxpayers looking to update their returns for FY 2019-20 will have to pay the tax due and interest along with an additional 50 percent of such tax and interest. While for those looking to file an Updated return for FY 2020-21, the additional amount will be 25 percent of the tax payable and interest.

What is the Time Limit to File the ITR-U?

The time limit provided 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.

What details are required to File Form ITR-U?

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 related to the filing of an updated return. It includes the following:

  • Are you eligible to file an updated return? i.e., a person is not falling in such circumstances wherein an updated return can’t be filed.
  • Selecting the ITR form for filing an updated return
  • Reasons for updating income. This includes reasons such as returns previously not filed, income not reported correctly, wrong heads of income chosen, etc.
  • Are you filing an updated return within 12 months from the end of relevant AY or between 12 to 24 months from the end of relevant AY?
  • Are you filing an updated return to reduce carried forward loss, unabsorbed dep., or tax credit?

Part B – Computation of updated income and tax payable (ITR-U) This part of ITR-U includes heads of income under which additional income is reported. The taxpayer is required to mention only the amount of additional income. Total income as reported in Part B of the ITR form shall also be reported here to compute the additional tax payable by the assessee on the updated return.

Who is ineligible to File Form ITR-U?

An Updated Return cannot be filed if :

  • If updated return is return of loss
  • If updated return is reducing Income Tax Liability in return filed earlier
  • If updated return results in the increase of Refund
  • If search has been initiated under section 132
  • If books of Accounts or any other documents are requisitioned under section 132A.
  • If survey has been conducted under section 133A
  • If any proceeding of assessment, reassessment, re-computation or revision is pending or completed for that relevant year
  • If Assessing Officer has information against such person under Prevention of Money Laundering Act or Black Money (Undisclosed Foreign Income and Asset) and Imposition of Tax Act or Benami Property Transactions Act or Smugglers and Foreign Exchange Manipulators Act and the same has been communicated to the assessee.
  • If information for the relevant assessment year has been received under an agreement referred to in section 90 or section 90A in respect of such person and the same has been communicated to him, prior to the date of furnishing of return under this subsection.
  • Other Notified Persons

How is an Updated Return verified?

ITR-U can be verified through :

  • Electronic Verification Code (EVC), is given for the non-tax audit cases.
  • Digital Signature Certificate (DSC) in tax audit cases.

Frequently Asked Questions

Q-What are the benefits of filing Updated Return i.e. Form ITR-U?

  • Taxpayers get an additional 24 months to file Income Tax Return even after the due date of filing Original ITR, Belated ITR and Revised ITR have lapsed or passed.
  • Taxpayers can report any missed out incomes and pay tax on it thus reducing 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.

Q- Can you claim a refund by filing the updated return?

No, if the Updated Return results in a decrease in tax liability, increase in a tax refund, or claiming of loss, the taxpayer cannot file an Updated Return.

Q- What is the due date to file Updated Return for AY 2021-22?

Due Date to file Updated Return is 24 months from end of relevant Assessment Year. Thus, the due date to file Updated Return in Form ITR-U for AY 2021-22 is 31st March 2024 (2 years from end of 31st March 2022)

Q- What is the due date to file Updated Return for AY 2020-21?

Due Date to file Updated Return is 24 months from end of relevant Assessment Year. Thus, the due date to file Updated Return in Form ITR-U for AY 2020-21 is 31st March 2023 (2 years from end of 31st March 2021).

Q- Is it possible to file two ITR U for a same financial year?

A taxpayer can file an Updated ITR only once for a Financial Year. Hence, it should be done carefully.

CA Abhishek Soni
CA Abhishek Soni

Abhishek Soni is a Chartered Accountant by profession & entrepreneur by passion. He is the co-founder & CEO of Tax2Win.in. Tax2win is amongst the top 25 emerging startups of Asia and authorized ERI by the Income Tax Department. In the past, he worked in EY and comes with wide industry experience from telecom, retail to manufacturing to entertainment where he has handled various national and international assignments.



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