Updated return (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. 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. Section 139(8A) under the Income Tax Act allows you a chance to update your ITR within two years i.e. 24 months from the end of the relevant assessment year,

For instance, for AY 2024-25, if the person missed the revised/ belated return filing window or if he needs to correct the earlier filed return where he had done some errors or omission. Individual can file an ITR-U after the end of the assessment year, i.e. 31 March 2024 but within two years from there, i.e. 31 March 2026.

WHO IS ELIGIBLE TO FILE UPDATED RETURN UNDER SECTION 139 (8A)

Any taxpayer can file an updated return u/s 139 (8A) 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

It is to be noted that the taxpayer is allow to file ITR-U once for each Assessment Year.

WHO IS NOT ELIGIBLE TO FILE UPDATED RETURN UNDER SECTION 139 (8A)

Updated return cannot be filed if-

• If an updated return is already filed
• If an updated return is the return of loss
• If an updated return reduces Income Tax Liability in the return filed earlier
• If updated return results in the increase of Refund
• If a search has been initiated under section 132
• If books of Accounts or any other documents are requisitioned under section 132A.
• If the 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 the 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 the 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

It is to be noted that updated return can be filed in case of additional tax or reduction of refund/losses are there, In case, taxpayer had omitted something which resulted in a increase in a refund amount or carried forward of additional losses etc… then the option of filing ITR-U is not available with the taxpayers.

Penalty for filing Updated return.

There is always a penalty associated for not to do something which was supposed to do or wrongfully do so the taxpayers would need to pay an additional 25% percent of the additional 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.

Time lines to file ITR-U

Conclusion

The purpose of this form to provide options to file the tax returns for those either who missed to file their tax return on the respective time lines or if the tax payer missed some transactions or information that was relevant to provide before the income tax department as a true and fair representation. 

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