How to File ITR-U (ITR for Previous Year)

FORM ITR-U (INDIAN INCOME TAX UPDATED RETURN):

Hello everyone, Welcome back to TAX DESTINATION Blog, we are here to bring to you one more important concept for this ITR Filing.

During the Union Budget 2022, A new sub-section (8A) in section 139 is proposed to be introduced to provide for the furnishing of updated returns under the new provisions.

The Finance Bill 2022 has been passed in the houses of parliament and CBDT has inserted a new Rule 12AC in the Income-tax Rules, 1962 w.e.f 1^st April 2022.

Persons eligible to file Form ITR-U:

Any person, whether or not he has furnished a return under-

• Section 139(1) – ITR filing until the due date
• Section 139(4) – Belated Return
• Section 139(5) – Revised Return

for any assessment year may furnish an updated return of income under section 139(8A) within 24 months from the end of the relevant assessment year.

According to Rule 12AC of Income-tax Rules, 1962 –

The above eligible persons may furnish a return of income under section 139(8A) relating to the assessment year commencing on 1^st April 2020 and subsequent assessment years as per the relevant provisions of the IT Act in Form ITR-U.

A taxpayer will be able to file only one updated return for each assessment year

ITR-U allows any taxpayer-

• to file the return of income not filed earlier.
• to rectify any incorrect disclosure in ITR.
• to rectify or change the head of Income.
• to reduce carry the forward loss.
• to reduce unabsorbed depreciation.
• to reduce income tax credit etc.

Cases in which Form ITR-U can be filed:

Any of the following reasons may be selected in Form ITR-U

• Return previously not filed
• Income not reported correctly
• Wrong heads of income chose
• Reduction of carried forward losses.
• Reduction of unabsorbed depreciation
• Reduction of tax credit u/s 115JB/115JC
• Wrong rate of tax
• Others

Cases in which Form ITR-U cannot be filed:

• Nil Return.
• Return of a loss
• The claim of Refund or Increase in a refund.
• Reduction in Tax Liability.
• Search/ Survey/ Prosecution Proceedings are initiated in the case of such person or any other person.
• any proceeding for assessment or reassessment or recomputation or revision of income under this Act is pending or completed for relevant AY in his case.

Tax on updated return (Additional Tax) under section 140B shall be paid and filling details of tax paid challan is mandatory in Form ITR-U.

Late fees and Additional Fees will also be charged.

Additional income-tax payable at the time of furnishing the return under sub-section (8A) of section  139:

If such return is furnished after the expiry of the time available under section 139(4) or section 139(5) and before completion of the period of 12 months from the end of the relevant assessment year – 25% of the aggregate of tax due, interest and fees payable as per the provisions of the Act.

If such return is furnished after the expiry of 12 months from the end of the relevant assessment year but before completion of the period of 24 months from the end of the relevant assessment year – 50% of the aggregate of tax, interest and fees payable as per the provisions of the Act.

Now taxpayer has the following options-

Before the expiry of the time limit specified under section 139(5) of the Income Tax Act, 1961.

• Filing of revised return under section 139(5) of Income Tax Act, 1961 or
• Filing of updated return under section 139(8A) of Income Tax Act, 1961 or
• Rectification of return under section 154 of Income Tax Act, 1961.

After the expiry of the time limit specified under section 139(5) of the Income Tax Act, 1961 but before completion of the period of 24 months from the end of the relevant assessment year –

• Filing of updated return under section 139(8A) of Income Tax Act, 1961 or
• Rectification of return under section 154 of Income Tax Act, 1961.

After the expiry of 24 months from the end of the relevant assessment year up to the time limit specified under section 154 of the Income Tax Act, 1961. 

• Rectification of return under section 154 of Income Tax Act, 1961.

Filing Procedure:

ITR U has been enabled for AY 2020-21 and AY 2021-22 in Excel utility for ITR 1 & 4 on 27th June 2022 in Income Tax Portal. It can be accessed through the following link- Downloads | Income Tax Department. There is no separate form for ITR-U, it can be accessed through the normal ITR-1 and ITR-4 forms.

On selection of section 139(8A) under “PART A GENERAL INFORMATION” in ITR-1 or ITR-4 in excel utility, a new worksheet named – “Part A Gen_139(8A)” will be enabled through which we can fill details related to updated return in Form ITR-U.

XML can be generated from the excel utility after filling in all the relevant information (Including mandatory fields indicated in red labels). The generated XML shall be uploaded to the Income Tax E-Filing Portal (Home | Income Tax Department). After uploading, the return shall be verified and submitted in order to complete the filing successfully.

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Hemanth Uppala

CA Finalist

Content Writer | TAX DESTINATION