Updated Return Under Section 139(8A)

Understanding Section 139(8A)

Effective Provision:

A taxpayer may file an Updated Return of income for a particular Assessment Year (AY) at any time within 24 months from the end of that AY, regardless of whether they had:

• Filed the original return on time (u/s 139(1))

• Filed a belated return (u/s 139(4))

• Filed a revised return (u/s 139(5))

The return must be filed in Form ITR-U, along with the applicable original ITR form, and must be accompanied by the payment of additional tax, interest, and fee, if applicable.

When Can an Updated Return Be Filed?

A taxpayer can furnish an updated return when:

• Income was omitted or underreported

• Wrong heads of income were chosen

• Wrong claims/deductions were made

• Certain income was mistakenly considered exempt

• To regularize a missed return

• When is an Updated Return NOT Allowed?

  1. Nature of Return:

     • If it is a loss return

     • If it decreases total tax liability

     • If it results in or increases a refund

  2. Search/Survey/Requisition Related:

     • If a search under section 132 or survey under section 133A (except 133A(2A)) has been conducted

     • If any books/assets are seized or requisitioned under section 132/132A related to the taxpayer

  3. Information in Possession of Tax Authorities:

     • If information exists under laws like:

       • Benami Act

       • PMLA

       • Black Money Act

       • Smugglers & Foreign Exchange Manipulators Act

     • If any international information under section 90/90A is received and communicated

  4. Other Restrictions:

     • If an updated return is already filed for that year

     • If any assessment/reassessment/revision is pending or completed for that year

     • If prosecution proceedings under Chapter XXII have started

     • If the person is part of a class notified by CBDT

  Special Cases:

  • If you originally filed a loss return in time, you can file an updated return only if the new return is a return of income (not loss).

  • If you're reducing losses, unabsorbed depreciation, or tax credits, you must file updated returns for each affected year in which the adjustment affects the carry forward.

Special Provisions for Loss Return Cases

• If a taxpayer filed a return of loss within the due date and now wishes to declare income, they may file an Updated Return.

• If any losses, depreciation, or tax credits carried forward are to be reduced due to an Updated Return, the taxpayer must file updated returns for all subsequent years impacted by that change.

Additional Tax Liability

Updated Return comes with a cost in the form of additional tax:

• 25% of total tax + interest if filed within 12 months from the end of the relevant AY

• 50% of total tax + interest if filed between 12–24 months

These amounts are in addition to the tax liability and interest as per regular provisions.

Filing Process

1. Calculate revised income and tax liability

2. Pay the tax, interest, and additional tax before filing

3. Use Form ITR-U along with the applicable ITR form

4. File through the Income Tax e-Filing portal

Use Cases and Examples

Example 1:

A salaried individual forgot to report ₹50,000 FD interest in AY 2022–23. They can file an updated return by 31st March 2025, pay the additional tax and regularize the error.

Example 2:

A partnership firm wants to revise their return to reduce income after discovering an error. They cannot file an updated return if it leads to a reduction in tax liability.