Taxpayers have a chance to correct mistakes or omissions in past tax returns by filing an updated return (ITR-U) before March 31, 2026.
Along with the additional tax, you will also need to pay applicable interest.
Filing an updated return under Section 139(8A) helps you avoid scrutiny, penalties, or even prosecution if the tax authorities later detect undisclosed income.
The longer you wait, the higher the additional tax you must pay:
Within 12 months: 25% of tax + interest
Within 24 months: 50%
Within 36 months: 60%
Within 48 months: 70%
For the Assessment Year 2021-22 (FY 2020-21), March 31, 2026, is the last date to file, as the four-year period ends on that day.
Who Can File an Updated Return?
An updated return can be filed by anyone who:
Made an error or missed reporting income in the original return, belated return, or revised return.
Forgot to file a return entirely and missed previous deadlines.
Needs to correct under-declared income, report income under the wrong head, pay tax at the wrong rate, or adjust carried forward losses or tax credits.
Important: Only one updated return per assessment year is allowed.
Who Cannot File an Updated Return?
Updated returns cannot be filed to:
Declare a nil return or loss return.
Claim or increase a refund.
Reduce tax liability.
You also cannot file if tax authorities have started enforcement actions, such as searches, surveys, or asset requisitions, or if assessment or reassessment proceedings are pending or completed.
The goal of the provision is voluntary payment of additional tax, not reducing what you owe.
Budget Amendment: Expanded Scope
From April 1, 2026, taxpayers can also file updated returns to:
Reduce the loss claimed in the original return.
Respond to a reassessment notice.
In such cases, an extra 10% of tax and interest is payable on top of the existing additional tax.
Income declared through this method will not attract a penalty, provided the additional tax is paid.
