The ITR-U, or Income Tax Return - Updated, is a form introduced by the government to address the needs of individuals who have not filed their income tax returns or have made inaccurate entries. This form serves as a rescue mechanism, enabling taxpayers to rectify errors or omissions in their ITRs within two years from the end of the relevant assessment year. It provides a crucial opportunity for individuals to update their income tax returns, ensuring accuracy and compliance with tax regulations. The ITR-U form plays a significant role in allowing taxpayers to correct and revise their financial information, ultimately contributing to a more precise and reliable tax reporting system.
ITR-U Filing Deadline
For the assessment year 2021-22, taxpayers have until 31 March 2024 to file an updated return using ITR-U if they have if they have omitted or incorrectly reported income.
Who is eligible to file ITR-U?
Any taxpayer is eligible to file ITR-U under Section 139 (8A) who have furnished or not furnished an original, revised, or belated return. An Updated Return can be filed in the following cases:
- Omission or Error Correction: Intended for addressing any omission, error, or incorrect statement in the earlier filed return of income.
- Not Filed Previously: Allows filing for those who have not submitted a return previously.
- Income Reporting Correction: Permits correction if income was not reported accurately in the earlier return.
- Heads of Income Correction: Provides the option to rectify the selection of wrong heads of income.
- Loss Adjustment: Facilitates the reduction of carried forward loss.
- Depreciation Adjustment: Allows for the reduction of unabsorbed depreciation.
- Tax Credit Adjustment: Permits the correction or reduction of tax credits under Section 115JB/115JC.
- Correcting Tax Rate: Enables adjustment if the wrong rate of tax was applied in the initial filing.
Additional Tax
The additional tax for Income Tax Return - Updated are :
Additional Tax Calculation (First Period): If filed within the initial 12-month period, the taxpayer incurs 25% of the further tax amount plus interest i.e., For AY 2021-22 if updated between April 1, 2022, and March 31, 2023.
Increased Additional Tax (Second Period): If filed within the extended 24-month period, the additional tax increases to 50% of the further tax amount plus interest i.e., For AY 2021-22 if the updated return is submitted between April 1, 2023, and March 31, 2024.
Step-by-Step Guide to Filing Form ITR-U
ITR-U form is divided into two parts— A & B
Part A: General Information
In this section of the ITR-U form, individuals are required to furnish essential personal details such as PAN, name, Aadhaar number, assessment year, and other relevant information.
Part B: Updated Income Tax Return
The second segment of the ITR-U form is dedicated to the updated income tax return. Here, taxpayers must complete the chosen ITR form as indicated in Part A. This involves reporting income from various heads, claiming deductions under applicable sections like 80C, 80D, 80G, etc.
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