ITR filing: Due date for non-audited income tax return (ITR) filing has gone and those who failed to file their ITR by the given due date, they need to file their return by last date of ITR filing i.e. 31st December 2022. While filing this year’s ITR, some taxpayers may come across some financial information that should have been a part of their previous ITRs. For such taxpayers, the central government introduced Income Tax Return – Updated (ITR-U), which enables a taxpayer to comply with their tax responsibilities without getting into hassles of the law. Finance Minister Nirmala Sitharaman made an announcement in this regard while presenting the union budget in February 2022.
Speaking on ITR-U, Aarti Raote, Partner at Deloitte India said, “ITR-U is the tax return form in which tax payers can file tax returns for assessment year two years prior to the current assessment year i.e. tax payer can file an updated return for AY: 2020-21 in FY: 2022-23 to offer to tax additional income. Thus an updated income tax return gives a chance to the tax payer for coming clean to the authorities if they have missed filing a tax return in the earlier year or have missed reporting some income. One would need to pay additional income-tax of 25 per cent of if the return is filed within 1 year and gets enhanced to 50 per cent.”
“You can file ITR-U for FY 2019-20 by 31st March 2023 and so on for subsequent assessment years. Only one ITR-U can be filed for each assessment year. The government is giving the facility through ITR-U to voluntarily disclose any income which was unaccounted for and come clean after paying an additional 25 per cent / 50 per cent tax of the amount of income missed to be reported. According to the reports, taxpayers have started using the facility and about 1 lakh ITR-U have been filed by now,” said Archit Gupta, Founder & CEO at Clear.
While speaking on ITR-U, CBDT Chairman Nitin Gupta told PTI that scheme was brought by the Union government for the benefit of taxpayers so that they can comply with their tax responsibilities without getting into hassles of the law.
“We have got around 1 lakh returns… (under the ITR-U). The taxpayer may have paid additional tax or they may be a new filer. Around ₹28 crore worth tax collection has been done under this scheme so far,” Nitin Gupta of CBDT said adding, “This is a provision for taxpayers to come forward and pay taxes rather than face the consequences of penalty or any other legal action under the income tax law.”
Taxpayers filing ITR-U form, which can be filed within 2 years of the end of the relevant assessment year, will have to give reasons for updating the income — return previously not filed or income not reported correctly or wrong heads of income chosen or reduction of carried forward loss.
“Taxpayers have started using the facility and about 1 lakh ITR-U have been filed by now. The Income-tax department has collected around ₹28 crore in taxes through the updated returns,” said Archit Gupta of Clear.
Download The Mint News App to get Daily Market Updates.