What is the difference between belated, revised and updated ITRs?

An individual is required to file an income tax return (ITR) to report the income earned in the previous financial year, and pay taxes accordingly. The due date for filing an ITR is July 31, unless the government extends the date. A tax return filed on or before July 31 is termed as original ITR. After the due date, the individual has the option to file other types of ITRs as mentioned under the Income-tax Act, 1961. Here is a look at the types of ITRs:

Belated income tax return

If an individual misses the original due date to file a tax return, she can use a belated ITR to file the tax returns so as to avoid any adverse action from the income tax department. It is filed under Section 139(4) of the Income-tax Act.

But taxpayers have to pay a penalty while filing a belated ITR. The penalty is levied under Section 234F of the act. For small taxpayers whose total income does not exceed Rs 5 lakh, the penalty would be Rs 1,000 or less. For others, it is Rs 5,000. No penalty is applicable if the gross total income is below Rs 2.5 lakh.

Abhishek Soni, CEO of ITR filing website, says, “Before a taxpayer files a belated ITR, they are required to deposit a late filing fee. This amount is required to be deposited irrespective of whether any self-assessment tax is due or not. Further, if any self-assessment tax is due or if there was any shortfall in advance tax, then penal interest will be levied as well.”

Revised ITR

If a person makes a mistake while filing the original ITR, then she has an option to correct the mistake through a revised ITR. For example, if a person forgets to disclose a bank account or interest from FD in the ITR, she can file a revised ITR to correct the mistake.

Soni says, “While filing a revised ITR, if additional income is reported in the ITR, then the individual may have to pay the additional income tax as well. Further, penal interest may be applicable on such tax paid.”

A revised ITR is filed under Section 139(5) of the Income-tax Act. According to income tax laws, the last date to file a revised ITR is December 31 – the same as a belated ITR. An individual can revise a belated ITR as well. However, if a person files a belated ITR at the last moment, then she will miss the chance to file a revised ITR if a mistake is discovered later.

There is no limit to the number of times a revised ITR can be filed. However, tax experts advise that one must not revise the ITR excessively as it can invite scrutiny from the income tax department.

Updated return

This was introduced in Budget 2022. An ITR-U can be filed only after the end of the relevant assessment year but within 24 months from the end of the relevant assessment year. Thus, even if you have filed an original or revised or belated ITR or completely missed filing an ITR, you can still file an updated ITR.

Soni says, “Taxpayers should note that after filing the original ITR, they will be required to file a revised ITR before December 31 to correct the mistakes made. However, if a taxpayer has missed the revised ITR filing date, then she can file an updated ITR to correct the mistakes. Similarly, if a person has missed the original ITR filing deadline, then she can file a belated ITR before December 31. If the belated ITR deadline is missed, then she can file the updated return.”

Updated returns can be filed under Section 139(8A) of the Income-tax Act using the ITR-U form. But there are certain stipulations while filing an updated return. For example, an updated return cannot be filed to show a lower income, loss or to claim income refund. If a person is filing ITR-U to report income not reported correctly in an earlier form, she will have to pay the penalty on the additional tax liability. The person has to mention the reason for filing an ITR-U.

Updated returns can be filed up to two years after the end of the relevant assessment year. Hence, individuals can now file ITR-U for FY 2020-21 and FY 2019-20.

Additional penalties are payable at the time of filing ITR-U. Soni says, “Additional taxes of 25% on the tax and interest is payable if the ITR-U is filed within one year from the end of the relevant assessment year. An additional tax of 50% on tax and interest is payable if the ITR-U is filed after the expiry of one year but before the end of the second year from the end of the relevant assessment year.”

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