Updated ITR Filing: The provision of updated income tax return was included in the Finance Act 2022. According to this, if for some reason the taxpayer is not able to file the income tax return or he forgets to declare any income, then he can file an updated return within 24 months of the end of the assessment year.
Updated ITR Filing: The deadline for filing updated Income Tax Return (ITR) for the financial year 2020-21 is near. This work will have to be completed by March 31, 2024. This provision was included in the Finance Act of 2022. This allows taxpayers to file updated ITR if they have not filed the return for the financial year mentioned above for any reason or have reported any income. This provision allows taxpayers to file updated returns within 24 months of the end of the relevant assessment year.
Who can file?
Taxpayers who have not been able to file ITR for financial year 2020-21 can do so by March 31, 2024. It is important to understand the difference between financial year and assessment year. We file returns for every financial year in the next financial year. The financial year in which we file the return is called the assessment year of the previous financial year.
Which form should be used?
To file updated returns, taxpayers will have to use the ITR form notified for the relevant assessment year. Also, the recently launched ITR-U will have to be used. Updated returns can be filed only electronically.
What information needs to be given?
Taxpayers will have to provide all the information in the updated return form. These include basic information, details of previously filed returns, reasons for filing updated returns and information about additional income according to different heads.
Why is there a need for updated ITR filing?
If a taxpayer discovers an error or omission in the previously filed return, he or she can file an updated return to correct the error. If a taxpayer has additional income from investment or freelance after filing the original return, he can declare this income by filing an additional return.
What are the benefits of updated ITR filing?
- By filing updated returns, taxpayers can avoid penalties for non-compliance of income tax law. By correcting the mistakes in the original return, taxpayers can prove their sincerity in following the tax rules.
- Filing of updated return is not allowed in the following situations:
- Taxpayers cannot file updated returns in case of any kind of loss.
- If filing an updated return reduces the tax liability of the taxpayer then he cannot file an updated return.
- If by filing an updated return the taxpayer’s refund amount increases compared to the original return, then the updated return is not allowed.
- If any kind of search, survey or seizure action has been initiated against the taxpayer, then he is not allowed to file updated returns until it is over.
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