Notified form for filing updated tax returns

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The Income Tax Department has notified a new form for filing updated returns

New Delhi:

The income tax service has notified a new form for filing updated computer declarations (RTI) in which taxpayers must give the exact reason for filing as well as the amount of income to be offered to the tax.

The new form (ITR-U) will be made available to taxpayers for filing updated tax returns for fiscal years 2019-20 and 2020-21. Taxpayers who file an ITR-U, which can be filed within two years of the end of the relevant tax year, will be required to provide reasons for updating the previously unfiled tax return or income not reported correctly or wrong revenue leaders selected or loss carryforward reduction.

Reasons given in the form also include reduction of unabsorbed depreciation or reduction of tax credit u/s 115JB/115JC or wrong tax rate or any other reason given by taxpayers.

Budget 2022-2023 allowed taxpayers to update their ITRs within two years of filing, subject to payment of taxes, a measure to help correct any discrepancies or omissions.

A taxpayer would only be allowed to file one updated return per tax year.

Shailesh Kumar, partner at Nangia & Co LLP, said the layout of the form was very precise to help the assessee easily enter the relevant information.

“Furthermore, it may be noted that only the amount of income to be offered for tax purposes needs to be specified under the prescribed income headings. No income breakdown or detailed information needs to be submitted, unlike the regular ITR forms and the exact reason for filing the updated return must be submitted in the form itself,” Mr. Kumar said.

“To provide an opportunity to correct these errors, I am proposing a new provision allowing taxpayers to file an updated return on payment of additional tax. This updated return may be filed within two years of the end of the tax year concerned”, declared the Minister of Finance. Nirmala Sitharaman said in his 2022-23 budget speech.

An additional 25% on the tax and interest due should be paid if the updated ITR is filed within 12 months, while the rate will increase to 50% if filed after 12 months but before 24 months to from the end of the relevant assessment year.

However, if a lawsuit is initiated by issuing a notice for a particular assessment year, taxpayers cannot receive updated return benefits in that particular year. Also, if a taxpayer files an updated return and does not pay the additional taxes, the return would be declared invalid.


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