CBDT Chairman Nitin Gupta said in an interview with PTI that ITR-U can also be used by those categories of taxpayers who have income from online games, lotteries and betting etc. “It is a provision for them to come forward and pay the tax instead of facing the consequences of penalty or any other legal action under the Income Tax Act,” the CBDT chairman said.
What is ITR-U?
ITR-U stands for Income Tax Return – Updated; Finance Minister Nirmala Sitharaman announced in her Budget 2022 speech. ITR-U has been filed under section 139(8A) of the Income Tax Act, 1961. ITR-U or update returns It was introduced to give taxpayers an easy way to rectify mistakes related to estimating their income on which tax is payable.
ITR-U provides an opportunity to update the Income Tax Return within two years after the end of the relevant assessment year. ITR-U provides an opportunity to taxpayers to include any income on which they forget to pay tax while filing their ITR. It is important to note that an additional tax of 25% to 50% is payable on additional income.
Taxpayers filing updated returns have to give reasons for updating income. Reasons may include – previously not filed return or not correctly reported income, incorrectly chosen head of income or forward loss reduction.
Prior to ITR-U, once the original ITR was filed, a person had the option to file only a revised ITR to rectify any mistake made while filing the return. The last date for filing Revised ITR is December 31 of the assessment year. Once this time limit is over, one cannot rectify the mistakes made while filing ITR.
At present, ITR-U can be filed for the financial years 2019-20 and 2020-21 or assessment year 2020-21 or 2021-22.
It was reported by PTI that the Income Tax Department has collected around Rs 28 crore in taxes after nearly 1 lakh returns were filed by taxpayers under the newly introduced return filing form called ITR-U.
Confirm ITR to get tax refund
The Income Tax Department is sending emails to taxpayers asking them to confirm that the ITR filed by them is correct. These emails are sent either because taxpayers have claimed a higher deduction than the employer claimed or if their gross total income is less than the previous year.
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Verify your ITR within 15 days to get tax refund
(with inputs from PTI)