ITR-U e-filing enabled AY 2020-21 and AY 2021-22

What is ITR-U?

Taxpayers will now be able to update their returns at any time within the next 2 years from the end of the relevant assessment year. E.g., The Return of FY19-20 can be updated till 31st March 2023. In case of any errors or omissions in their initial tax returns, they can amend them by filing Form ITR-U. This concept of updating returns was announced in the recent Union Budget 2022.

The Form ITR-U has three parts- General information, ATI computation of total updated income, and tax payable and tax payments as per updated return. You can visit the ‘downloads’ section on the e-filing portal and download the excel utility or the JSON schema. You can update these and upload them on the portal. Currently, the utility is available only for ITR 1 and 4. The return shall be considered valid only if additional taxes are paid.

Additional taxes to be paid while filing ITR-U

ITR-U filed within Additional Tax Interest
12 months 25% of the tax due  On the extra income
24 months 50%  of the tax due  On the extra income

 

Your total income tax liability would be as under:

Total Income Tax Liability= Tax Payable + Interest +Late-filing fees + Additional Tax

Total Income Tax Liability (as above) – TDS/TCS/Advance Tax/Tax Relief = Net Tax Liability

When can I file ITR-U?

You can use ITR-U to update your income in the following cases:

  • Return not filed previously 
  • Income was not reported correctly
  • Chose incorrect heads of income
  • Loss to be carried is less than what was reported
  • Unabsorbed depreciation to be carried is less than what was reported
  • Tax credit u/s 115JB/115JC reduction

When are you not allowed to file ITR-U?

You cannot file ITR-U for the following cases:

  • You wish to claim a loss
  • The updated return leads to a reduction in your income tax liability
  • The updated return leads to an increase in the amount of your refund
  • Search proceedings are initiated
  • A survey is being carried on
  • Any assessment proceeding, revaluation, recalculation, or revision is pending or completed in respect of the initial return.
  • The Assessing Officer has received information against the taxpayer under a few specified Acts.

For any clarifications/feedback on the topic, please contact the writer at ektha.surana@clear.in

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