How to File an Updated ITR: A Complete Guide

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Are You Aware That Nearly 6.8 Million Taxpayers Missed Key Disclosures Last Year?

Mistakes in income tax filings are more common than you’d think. From unreported income to accidental omissions, these errors can lead to unnecessary stress, penalties, or even legal issues. But there’s good news: you now have a second chance to set the record straight.

In this guide, you’ll discover everything you need to know about filing an updated return: including eligibility, process, timelines, and hidden costs.

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What Is an Updated ITR?

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An Updated Income Tax Return (ITR-U) gives individuals the opportunity to correct or disclose missing financial information in a previously filed return or even file one that was missed altogether. Introduced under Section 139(8A) of the Income Tax Act, this form is designed to promote voluntary compliance without the threat of heavy penalties or prosecution.

You can use this provision to file ITR within 24 months after the end of the relevant assessment year. It is especially helpful if you:

• Forgot to report certain income sources
  
  
• Missed the original filing deadline
  
  
• Made calculation or declaration errors
  
  

However, it is not applicable in every situation.

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Who Can and Cannot File an Updated ITR?

Not all taxpayers can take advantage of the ITR-U provision. The government has outlined specific eligibility norms:

Eligible Individuals:

• Those who missed the deadline to file ITR altogether
  
  
• Individuals or businesses that need to declare additional income
  
  
• Anyone looking to correct mistakes made in the original or revised return
  
  

Not Eligible:

• Taxpayers expecting a refund or aiming to increase an earlier refund
  
  
• Those whose updated filing would result in reduced tax liability
  
  
• Cases involving search/survey actions or legal prosecution
  
  
• If the tax authorities already have flagged information under laws like PMLA or Black Money Act
  
  
• If more than 24 months have passed since the end of the assessment year
  
  

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Time Limits and Late Filing Charges

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The updated return must be submitted within two years from the end of the relevant assessment year. The penalties are structured as an incentive for early compliance:

Time of Filing

Additional Tax Payable

Within 12 months

25% of tax and interest due

After 12 but within 24 months

50% of tax and interest due

This additional charge is calculated over and above the normal tax and interest owed.

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Step-by-Step Guide to Filing an Updated ITR

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Here’s how to get it done smoothly:

• Collect Required Documents
  
  
  
  • PAN details
    
    
  • Additional income documents
    
    
  • Bank account information
    
    
  • Tax computation including interest and penalties
    
    
• Login to the Income Tax E-Filing Portal
  
  
  
  • Use your PAN and password to access the dashboard
    
    
• Navigate to ITR Filing
  
  
  
  • Select ‘e-File’ → ‘Income Tax Returns’ → ‘File Income Tax Return’
    
    
• Choose the Correct Assessment Year and Form
  
  
  
  • Pick the year you want to file for
    
    
  • Select the appropriate ITR form (e.g., ITR-1 or ITR-2)
    
    
  • Choose “Updated Return under Section 139(8A)”
    
    
• Disclose the Purpose of Update
  
  
  
  • Provide reasons for updating the return (e.g., missed income)
    
    
  • Input revised income details and calculate your new tax liability
    
    
• Calculate and Pay Tax
  
  
  
  • Use the system’s calculator to estimate tax, interest under 234A/B/C, and additional tax
    
    
  • Make payment via Challan No./ITNS 280 and retain the receipt
    
    
• Verify and Submit
  
  
  
  • Submit the form online
    
    
  • Verify using Aadhaar OTP, EVC, DSC, or by sending a physical ITR-V to CPC, Bengaluru

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Important Rules You Must Not Overlook

Before submitting, keep the following in mind:

• ITR-U can be filed only once per assessment year
  
  
• It cannot be used to claim or enhance refunds
  
  
• All calculations and proof of payments should be stored for at least six years
  
  
• Mismatched entries can lead to rejection
  
  

Why Filing an Updated ITR Is Worth It

Using ITR-U gives you a legitimate way to avoid penalties and protect yourself from scrutiny. It improves your compliance history and prevents the tax department from taking action before you do. Acting early also saves you from the burden of 50% extra tax due to delays.

If you missed the first window, don’t miss the second. Use the opportunity to file ITR the right way—before the deadline closes in.

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