Salary &  Capital Gain ITR-2- ITR U Filing

What is Income Tax Updated Return (ITR-U)

Updated return is a type of return on income u/s 139(8A) of the Income Tax Act 1961 to be filed using Form ITR-U. It allows taxpayers to:

• File Return of Income Not Filed Earlier

• Make Corrections in Disclosure in Income Tax Return

• Fix or Change the Head of Income

• Reduce the Carry Forward Loss

• Reduce Unabsorbed Depreciation

• Reduce Income Tax Credit and More

Additional Tax Payment

The Act requires that the taxpayer has to pay an additional 25 per cent interest on the tax due if the updated ITR is filed within 12 months, while interest will go up to 50 per cent if it is filed after 12 months but before 24 months from the end of relevant Assessment Year. Hence, taxpayers looking to update their returns for FY 2019-20 will need to pay the tax due and interest along with an additional 50 per cent of such tax and interest. For those looking to file an updated return for FY 2020-21, the additional amount will be 25 per cent of the tax payable and interest.

When You Can’t Submit an Updated Return?

In the following circumstances, an updated return cannot be furnished if:

• The updated return is a return of the loss

• The updated return is reducing the Income Tax Liabilty  from the return filed earlier

• The updated return result increases the refund

• The search has been started under section 132

• Books of accounts or any other document are called for under section 132A.

• A survey is done under section 133A

• Any proceeding of assessment, revaluation, recalculation, or revision is pending or completed in that year.

• The AO has information against such person under the Prevention of Money Laundering Act or Black Money (Undisclosed Foreign Income and Assets) and Tax Act or Benami Property Transactions Act or Smugglers and Foreign Exchange Manipulation Act and the same have been reported to the assessee.

• Other Notified Person