TR Filing: While the deadline to file one’s original income tax return (ITR) for any financial year ends on July 31 (until extended by government), individuals can still file belated and updated returns later. Read this to understand further
The deadline to file updated income tax return (ITR) for FY 2019-20 is March 31, 2023. So, taxpayers who missed filing it for the said financial year or may have missed reporting any income can file an updated ITR or ITR-U. The Finance Act of 2022 introduced the concept of updated returns to allow a longer duration for an assessee to file the return of income.
An updated return can be filed within 24 months (2 years) from the end of the relevant assessment year (subject to certain conditions). Hence, if taxpayers missed filing it for FY2019-20, they can do the same now till March 31.
Additional tax
A penalty or fee is not levied upon a person who wishes to furnish an updated return. However, they will be required to pay an additional tax in accordance with Section 140B of the Income Tax Act.
A taxpayer is liable to pay 25 percent additional tax on the tax dues if ITR-U is filed within 12 months from the end of relevant assessment year. However, if the ITR-U is filed within 24 months from the end of relevant assessment year, then 50 percent additional tax on the dues is to be given. This means that in case of filing updated ITR for FY2019-20, 50 percent additional tax will be payable.
The assessment year for FY2019-20 was AY2020-21.
Forms required
A taxpayer must furnish an updated return in those ITR forms which were notified for the respective assessment year for which an updated return is to be furnished. Such an ITR form is to be filed along with the newly notified form ITR-U.
Computation of tax payable for an updated return
The total income tax liability would be tax payable + interest + late filing fees + additional tax. The net tax liability will come to total income tax liability (as above) – TDS/TCS/advance tax/tax relief.
Importance of ITR filing
Under income tax laws, ITR filing is an annual activity seen as a duty of every responsible citizen of the nation. Individuals can claim the refund of the excess tax paid/deducted during a financial year by filing it.
What happens if taxpayers don’t file ITR at all?
In taxpayers do not file ITR at all, they will not be able to carry forward the losses of the current assessment year. Also, a penalty may be levied, which is a minimum of 50 percent of the assessed tax or a maximum of 200 percent of the assessed tax. Additionally, they can face prosecution in extreme and high-value cases.
