Filing an Income Tax Return (ITR) is crucial, but many taxpayers make errors or miss important details while submitting their returns. If you have made a mistake in your ITR or failed to file it on time, the Updated Income Tax Return (ITR-U) can help you correct the errors and avoid penalties or notices from the Income Tax Department.
What is ITR-U?
ITR-U (Updated Income Tax Return) is a provision introduced under Section 139(8A) of the Income Tax Act that allows taxpayers to correct or update their ITRs even after the deadline has passed.
✅ Key Features of ITR-U:
- Helps taxpayers correct errors or add missing details in their ITR.
- Can be filed within 4 years from the end of the relevant assessment year (from April 2025, as per Budget 2025).
- Can be filed only once per assessment year.
- Cannot be used to claim a higher refund.
Who Can File ITR-U?
The following taxpayers can file ITR-U if they have:
✅ Missed filing their ITR within the due date.
✅ Filed the wrong ITR form (e.g., filed ITR-1 instead of ITR-2).
✅ Forgot to claim deductions or exemptions (such as under Section 80C, 80D, or 10(14)).
✅ Need to disclose additional tax liability.
✅ Made errors in reporting TDS or advance tax payments.
Who Cannot File ITR-U?
🚫 You CANNOT file ITR-U if:
❌ You have already filed ITR-U for that year.
❌ You are under an income tax survey, investigation, or scrutiny.
❌ Your original ITR contains fraudulent or false information.
❌ Your ITR has been selected for assessment or reassessment.
❌ You want to claim a refund or reduce your tax liability.
❌ The ITR filing deadline has already expired.
How to File ITR-U?
You can file ITR-U online on the Income Tax e-filing portal (eportal.incometax.gov.in) by following these steps:
🔹 Step-by-Step Process
1️⃣ Log in to the e-filing portal using your PAN and password.
2️⃣ Go to "File Income Tax Return" and select Assessment Year.
3️⃣ Choose ITR-U (Updated Return).
5️⃣ Pay additional tax, if applicable.
6️⃣ Submit the form and verify using Aadhaar OTP, net banking, or digital signature.
When Can You File ITR-U?
🔹 Previously, the time limit for filing ITR-U was 2 years from the relevant assessment year. However, as per Budget 2025, this has been extended to 4 years, effective April 2025.
Example:
- If you missed filing ITR for FY 2022-23 (AY 2023-24), you can now file ITR-U until March 31, 2027.
- If you made an error in FY 2023-24 (AY 2024-25), you can correct it until March 31, 2028.
🚨 Important: ITR-U can be filed only once for a particular assessment year, so ensure all corrections are included before submission.
Additional Tax on ITR-U Filing
If you are filing ITR-U to report additional income, you need to pay an extra tax as per the following slabs:
| Time Period (from due date of original ITR) | Additional Tax Payable |
|---|---|
| Within 12 months (1 year) | 25% of additional tax |
| 12-24 months (2 years) | 50% of additional tax |
| 24-48 months (4 years, from April 2025) | (Yet to be defined by IT Dept.) |
Why File ITR-U?
✔️ Avoid Notices & Penalties – If you receive a tax notice for underreporting income, filing ITR-U can help you rectify it before action is taken.
✔️ Fix Errors & Omissions – If you forgot to report income or claim deductions, ITR-U allows you to correct it hassle-free.
✔️ Extended Time Frame – With the new 4-year limit, you get ample time to correct mistakes.
Conclusion
ITR-U is a lifeline for taxpayers who have missed deadlines or made mistakes in their tax returns. With the extended 4-year period from April 2025, it offers more flexibility to correct errors. However, it cannot be used for refund claims or fraudulent filings.
💡 Pro Tip: If you realize an error in your ITR, file ITR-U as soon as possible to avoid paying higher penalties. Always consult a tax expert before filing an updated return.
📢 Stay tax-compliant and avoid unnecessary penalties with ITR-U! 🚀
