Demystifying the Updated Income Tax Return (ITR-U)

Introduction: Budget 2022 introduced the concept of an Updated Income Tax Return (ITR-U) to rectify errors or omissions in previous filings. Understanding Section 139(8A): Eligibility and restrictions outlined for filing ITR-U within 24 months from the end of the relevant assessment year. Conditions where filing an Updated ITR is not permissible.

Introduction of Form ITR-U: Central Board of Direct Taxes (CBDT) introduced Form ITR-U for filing Updated Income Tax Returns. Available from Assessment Year 2020-21 onwards. Due Date for Filing: Within 24 months from the end of the relevant assessment year. Filing allowed after the expiry of the time limit for Revised or Belated ITR.

Penalty on Filing ITR-U: Different scenarios explained for taxpayers who have filed ITR earlier and those who haven't. Additional tax and penalties under Section 140B detailed. Difference from Revised ITR (139(5)): Contrast between Updated ITR and Revised ITR explained. Unique characteristics and limitations of each clarified.

Summary of Tax Liability Computation: Step-by-step breakdown of tax payable with an Updated Return. Clear outline of calculations and applicable penalties. Conclusion: ITR-U serves as a crucial tool for taxpayers to rectify errors and ensure compliance. Understanding the nuances of filing an Updated Return is essential for accurate tax reporting and adherence to regulations.