Filing of Updated/ Income Tax Return for the Financial Years 2021-22 and 2022-23

 

 

 

Filing of Updated/ Income Tax Return

for the Financial Years 2021-22 and 2022-23

 

 

Background:

 

The Finance Minister, Mrs Nirmala Sitharaman, in her Budget Speech of 2022 has  mentioned:

 

“India is growing at an accelerated pace and people are undertaking multiple financial transactions. The Income Tax Department has established a robust framework of reporting of taxpayers' transactions. In this context, some taxpayers may realize that they have committed omissions or mistakes in correctly estimating their income for tax payment. To provide an opportunity to correct such errors, I am proposing a new provision permitting taxpayers to file an Updated Return on payment of additional tax. This updated return can be filed within two years from the end of the relevant assessment year.

 

In this context, it is also equally important to note that some of the Assessees have not filed or failed to or forgot to file Return of Income within Due Date U/s 139(1) or extended Due Date  i.e., December 31 U/s 139(4) of the Act for  reasons or circumstances beyond their control

 

For the above persons, this newly introduced Section { Section 139(8A) effective from April1, 2022} benefit them in updating/correcting their Tax Returns

 

 

Eligible Persons:

 

1.         Any person (including Non Residents) who has not filed Return of Income for the Financial Years 2021-22 and 2022-23 (Assessment Years 2022-23 and 2023-24)

 

2.         Any person (including Non Residents) who has already filed but  wish to correct/update  Return of Income for the Financial Years 2021-22 and 2022-23 (Assessment Years 2022-23 and 2023-24)

 

Reasons for filing the Updated Return:

 

1.  Not filing the Return previously

2.  Income not reported correctly

3.  Wrong Heads of Income chosen

4.  Reduction of Carried Forward Loss

5.  Reductio of Unabsorbed Loss

6.  Reduction of Tax Credit

7. Wrong Rate of Tax.

 

Important features to keep in mind while filing Updated Return:

 

1.  The Assesseee has to pay Tax, Additional Fee/Penalty and Interest (234A Delay, 234B-Failure to pay advance tax and 234C - Deferment of advance tax) till the date of filing along with  Additional Tax of 25% on Aggregate Tax and Interest, if filing is done before completion of 12 months and  additional tax of 50% on  Aggregate Tax and Interest, if filing is done after expiry of 12 months but before 24 months.

 

2.   Return cannot be filed for claiming Refund/No Refund will be paid

 

3.  Persons on whom Search, Seizure, Survey proceedings have been initiated or  Notices were served, they are not eligible to file the Updated Return.