ITR-U serves as a means for taxpayers to correct errors in their previously filed income tax returns. These errors may include under-reporting or misreporting of income or failure to file a return by the due date. Taxpayers need to file an updated income tax return (ITR-U) for Assessment Year (AY) 2021-22 (Financial Year 2020-21). This filing allows taxpayers to rectify errors such as under-reporting or misreporting of income from their previously filed ITR. It’s crucial to adhere to this deadline as failing to do so can result in penalties of up to 200 per cent of the tax evaded.
What Is ITR-U?
ITR-U serves as a means for taxpayers to correct errors in their previously filed income tax returns. These errors may include under-reporting or misreporting of income or failure to file a return by the due date.
Deadline for Filing ITR-U
Taxpayers have a window of 24 months from the end of the relevant assessment year to file an updated income tax return (ITR-U). For instance, for the Financial Year 2020-21 (AY 2021-22), the deadline to submit ITR-U is March 31, 2024.
Additional Tax Payment Filing
ITR-U often necessitates the payment of additional tax, depending on the individual circumstances. The additional tax amount typically equals 50% of the aggregate of tax and interest payable upon filing the updated return. However, if the return is filed after the due date but within 12 months from the end of the relevant assessment year, the additional tax payable reduces to 25% of the aggregate of tax and interest payable.
Why Filing ITR-U is Essential?
Filing an updated income tax return (ITR-U) is crucial for taxpayers who have inadvertently concealed or misreported income in their initial filings. Rather than relying on the Income Tax Department not discovering such discrepancies, it’s advisable to proactively rectify errors through ITR-U to avoid potential penalties and legal implications.
