Updated ITR

The document used to update your income tax return is called an ITR-U.In the Union Budget 2022, the government first mentioned the idea of an updated refund.

Updated Section 139 Return(8A) Belated ITR and Revised ITR are both functions of Updated ITR. In other words, it applies to taxpayers who submitted their ITR on time, or even after the deadline, and plan to revise it. Additionally, it applies to taxes who haven’t yet submitted their ITR for a specific AY.

Updated ITR can be filed within 24 months from the end of relevant assessment in case of:

1. Belated ITR filed under Section 139(4) or
2. Revised ITR filed under Section 139(5) or
3. Income not declared correctly.
4. Chose wrong head of Income.
5. Paid tax at wrong rate.
6. To reduce carry forward loss.
7. To reduce tax credit under section 115JB/115JC.
8. ITR not filed for a particular AY Updated ITR or
9. ITR-U has been started for ITRs of AY 2020-21 onwards. Last date to file ITR-U for AY 2020-21 is 31.3.23 as per above rule of 24 months.
10. ITR filed within due date under Section 139(1) or

Who is not eligible to file Updated ITR.

1. ITR with loss or Nil ITR cannot be filed .
2. By filing Updated ITR, the tax liability must not decrease.
3. Filing of Updated ITR must not lead to refund or increase in refund
4. Updated ITR for any AY can be filed only once .
5. For filing Nil return/loss return.
6. Updated ITR cannot be filed if search, seizure or survey related proceedings are in process .
7. If additional income is reported but additional tax liability is adjusted with tax credits or additional income is adjusted against losses.

Additional Tax Liability in case of Updated ITR

Income Tax Liability in case of updated ITR is total of –Tax Liability on income reported +Late ITR filing fees+ Additional Tax(as explained below)+ Interest on Tax .

As already discussed, Updated ITR can be filed within 24 months from the end of relevant AY.

• If ITR-U is filed within 12 months from the end of relevant AY ———— 25% of additional Tax +Interest on tax is to be paid and

If ITR-U is filed within 13 to 24 months from the end of relevant AY —– 50% of additional Tax +Interest on tax is to be paid.