How to File Updated Income Tax Return (ITR-U) Step-by-Step Online
- Rajesh Kumar Kar
- Oct 31
- 10 min read
Filing an Updated Income Tax Return (ITR-U) allows taxpayers to correct mistakes or declare missed income after submitting their original or belated return. Introduced under Section 139(8A) of the Income Tax Act, this provision enables individuals to file or revise their returns within 24–48 months from the end of the relevant assessment year. It’s designed to promote voluntary compliance while avoiding penalties for non-disclosure of income.
Table of Contents
What Is an Updated Return (ITR-U)?
An Updated Return, commonly known as ITR-U, is a provision introduced under Section 139(8A) of the Income Tax Act that allows taxpayers to rectify mistakes or disclose additional income after filing their original, revised, or belated return. It provides a second opportunity to declare any missed income, correct omissions, or update inaccurate details from the earlier filed return. This facility is aimed at improving voluntary compliance, enabling taxpayers to correct genuine errors without waiting for a notice from the Income Tax Department.
The ITR-U can be filed within 48 months from the end of the relevant assessment year. However, it cannot be used to claim a refund, reduce tax liability, or report losses. Instead, it is meant to increase the reported income or tax paid, ensuring that any under-reported income is disclosed before it attracts scrutiny or penalties.
Eligibility Criteria for Filing ITR-U
Not every taxpayer is eligible to file an Updated Return. The Income Tax Department has outlined specific conditions to determine who can and cannot use this facility.
Eligible individuals and entities include:
Taxpayers who failed to file their original return within the due date.
Individuals or businesses that omitted certain income in their previously filed returns.
Taxpayers who made calculation errors or missed reporting TDS/TCS details.
Ineligible cases include:
If the updated return results in a loss or reduction of previously declared income.
Cases where a refund is being claimed or an earlier refund is being increased.
Situations where proceedings for search, seizure, or assessment are already initiated.
Cases involving prosecution under the Income Tax Act.
Essentially, ITR-U can only be filed when the taxpayer intends to increase the taxable income or pay additional taxes for a given year.
When and Why Should You File an Updated Return?
An Updated Return should be filed when a taxpayer realizes that certain income or information was not reported in the earlier return. This can happen due to oversight, missed interest income, incorrect classification of income heads, or discrepancies between AIS (Annual Information Statement) and the filed return.
Filing an ITR-U helps avoid penalties, interest, and notices from the Income Tax Department for under-reporting or non-reporting of income. It also demonstrates good faith and voluntary compliance, reducing the likelihood of scrutiny in the future.
Common reasons for filing an ITR-U include:
Missed reporting of income such as bank interest or capital gains.
Errors in computation of deductions or exemptions.
Failure to file the original return within the due date.
Correction of TDS mismatches or inclusion of foreign income not reported earlier.
Step-by-Step Process to File Updated Return (ITR-U) Online
Log in to the Income Tax Portal: Visit www.incometax.gov.in and log in using your PAN as the user ID. If not registered, complete the registration process first.
Navigate to File Return: Click on “e-File” and select “Income Tax Return.” Choose the appropriate assessment year for which you wish to file the updated return.
Select ITR Type: Under “Type of Filing,” choose “Updated Return under Section 139(8A).”
Choose the Correct ITR Form: Depending on your income sources, select the applicable ITR form (ITR-1 to ITR-7).
Fill General Information: Provide PAN, Aadhaar, and details of the previously filed return, including acknowledgment number and filing date.
Specify Reason for Update: Select the reason—such as omission or under-reporting of income—that justifies filing the updated return.
Provide Additional Income Details: Enter the newly reported income under appropriate heads (salary, business, capital gains, etc.).
Upload Tax Details: Verify or update TDS, TCS, advance tax, or self-assessment tax paid.
Review Tax Calculation: The system auto-computes your total tax liability. Verify it carefully before proceeding.
Pay Additional Tax: If additional tax is due, pay it using the “e-Pay Tax” feature or generate a challan through the portal.
E-Verify and Submit: Use Aadhaar OTP, DSC, or EVC to e-verify and complete the filing process.
Key Points to Remember Before Filing ITR-U
ITR-U can be filed only once for each assessment year.
Updated returns cannot be filed to claim or increase refunds.
Filing should be done only if there is additional tax to be paid.
The time limit for filing is 48 months from the end of the relevant assessment year.
Additional tax of 25% or 50% of the tax due is levied, depending on the tax filing period.
Taxpayers must ensure all bank accounts are pre-validated for refund and verification purposes.
The updated return should reflect accurate and complete details to prevent future discrepancies.
Time Limits and Penalties under Section 139(8A)
Under Section 139(8A), taxpayers can file an updated return within a maximum of 48 months from the end of the relevant assessment year.
The law specifies two timelines with additional tax implications:
Within 12 to 24 months: Additional tax of 25% of the total tax and interest due.
Within 24 to 36 months: Additional tax of 50% of the total tax and interest due.
If the taxpayer delays filing beyond 36 months, the return will no longer be accepted. These penalties are designed to encourage timely correction and voluntary disclosure.
Difference Between Revised Return and Updated Return
Particulars | Revised Return | Updated Return (ITR-U) |
Section | 139(5) | 139(8A) |
Purpose | To correct errors in a previously filed return before the due date | To disclose omitted income or rectify mistakes after due dates |
Time Limit | Before the end of the assessment year | Within 48 months from the end of the assessment year |
Refund Claim | Allowed | Not allowed |
Additional Tax | Not applicable | 25% or 50% depending on delay |
Filing Frequency | Multiple times before the deadline | Only once per assessment year |
Tax Payment and Verification Process
Before submitting the updated return, ensure that all tax dues, including additional tax, have been paid through Challan No. ITNS 280 using the e-pay tax service. Once payment is complete, the challan details must be entered in the return form.
After submission, the return must be verified electronically via Aadhaar OTP, Digital Signature Certificate (DSC), or Electronic Verification Code (EVC). Only after verification will the return be considered valid and processed by the Income Tax Department.
Common Errors to Avoid While Filing ITR-U
Selecting the wrong assessment year or ITR form.
Entering incomplete income details or omitting interest income.
Forgetting to pay additional tax before filing.
Submitting without verifying the return.
Ignoring discrepancies in Form 26AS, AIS, or TIS data.
Using incorrect challan details during payment.
Filing ITR-U with the intention to claim a refund.
Avoiding these mistakes ensures the return is accepted without errors or delays.
Benefits of Filing Updated Return through TaxBuddy
Filing an updated return can be complicated, especially when dealing with old data and additional taxes. TaxBuddy simplifies this process using its AI-driven platform that automatically fetches data from AIS and TIS, detects mismatches, and calculates accurate tax liability.
With both self-filing and expert-assisted options available, users can choose how they prefer to file. The platform ensures that all compliance checks are met, payments are correctly computed, and submissions are verified in real time. By using TaxBuddy, taxpayers can save time, reduce errors, and file confidently without missing any step.
Conclusion
The Updated Return (ITR-U) is a practical mechanism for taxpayers to correct omissions, disclose unreported income, and stay compliant. Filing it within the prescribed time frame not only avoids penalties but also strengthens financial transparency. For anyone looking for assistance in tax filing, it is highly recommended to download theTaxBuddy mobile app for a simplified, secure, and hassle-free experience.
FAQs
Q1. Does TaxBuddy offer both self-filing and expert-assisted plans for ITR filing, or only expert-assisted options?
TaxBuddy provides taxpayers with complete flexibility by offering both self-filing and expert-assisted plans. The self-filing plan is designed for individuals who prefer to manage their own tax filing using a guided, step-by-step AI interface that minimizes errors. It simplifies complex tax calculations and automatically picks data from Form 16 and other documents. On the other hand, the expert-assisted plan connects users with certified tax professionals who handle the entire filing process on their behalf — from document review to submission and verification. This ensures accuracy, compliance, and convenience, catering to all levels of tax-filing comfort.
Q2. Which is the best site to file ITR?
The official Income Tax e-filing portal remains the government’s primary platform for filing returns. However, many taxpayers prefer using trusted private platforms like TaxBuddy, which offer a more intuitive experience. TaxBuddy stands out for its AI-powered tax computation, automatic data import from Form 26AS and AIS, and real-time validation of errors before submission. It also provides expert guidance to handle complex income scenarios such as capital gains, foreign income, or business income. This combination of technology and professional support makes TaxBuddy one of the most reliable and user-friendly platforms for ITR filing in India.
Q3. Where to file an income tax return?
An income tax return can be filed either on the government’s official portal,www.incometax.gov.in, or through recognized tax platforms like TaxBuddy. The official portal suits those familiar with the process, while platforms like TaxBuddy simplify the journey for both beginners and professionals by automating calculations and ensuring compliance with the latest tax laws. With TaxBuddy’s AI-driven filing system, taxpayers can upload Form 16, validate AIS/TIS data, and file returns seamlessly without worrying about missing deductions or triggering errors.
Q4. What is the time limit for filing an Updated Return (ITR-U)?
The Updated Return (ITR-U) can be filed within 48 months from the end of the relevant assessment year. For example, for Assessment Year (AY) 2022–23, taxpayers can file an updated return up to March 31, 2027. However, the longer one waits, the higher the additional tax payable. If the ITR-U is filed within 12 to 24 months from the end of the assessment year, an additional 25% of tax and interest is charged. If filed between 24 to 36 months, the additional tax increases to 50%. The purpose of this timeline is to encourage voluntary correction of income details before the tax department initiates any scrutiny or penalty.
Q5. Can a refund be claimed through ITR-U?
No, the ITR-U facility is not meant for claiming or increasing refunds. It is designed solely for taxpayers who need to disclose additional income or correct under-reported details, resulting in a higher tax outflow. The Income Tax Act specifically restricts refund claims under Section 139(8A) to prevent misuse. Therefore, the ITR-U can only be filed when there is an increase in income or tax liability, not for lowering taxes or claiming previously missed refunds. This ensures that the provision remains a channel for voluntary compliance rather than refund claims.
Q6. What happens if additional tax under Section 140B is not paid before filing ITR-U?
Before submitting an Updated Return, taxpayers must first pay all due taxes, including additional tax under Section 140B, which applies at 25% or 50% of the tax and interest depending on the filing delay. If this payment is not completed before filing, the return will be treated as defective or invalid. The Income Tax Department will not process the return until the required amount is paid. Hence, taxpayers must generate and pay the challan (ITNS 280) under the correct head — “Self-Assessment Tax” — and ensure challan details are correctly entered in the ITR-U form before submission.
Q7. Can I file ITR-U for a year where no original return was filed?
Yes, taxpayers can file an Updated Return even if no original or belated return was submitted for that assessment year. The introduction of Section 139(8A) enables non-filers to come forward voluntarily and disclose their income for any of the last two assessment years within the 48-month window. However, it must lead to payment of additional tax; otherwise, the return will not be accepted. This flexibility is particularly beneficial for individuals who unintentionally missed filing their return and now wish to correct it before the Income Tax Department identifies the non-compliance.
Q8. How many times can an Updated Return be filed for the same year?
Only one Updated Return can be filed for each assessment year. Once an ITR-U is filed, it cannot be revised, corrected, or resubmitted. Therefore, taxpayers must verify all figures, ensure all additional income is disclosed, and confirm that the tax has been accurately computed before submission. This one-time opportunity emphasizes the need for careful preparation, ideally with the help of professional platforms like TaxBuddy that minimize errors and provide expert validation before filing.
Q9. What is the difference between ITR-U and a revised return under Section 139(5)?
A revised return under Section 139(5) is filed to correct errors or omissions in a return that was already filed within the due date, and it can be submitted before the end of the relevant assessment year. In contrast, an Updated Return (ITR-U) under Section 139(8A) can be filed even after the assessment year has ended, providing up to 48 months to rectify unreported income or inaccuracies. However, while a revised return may lead to a refund or reduced liability, an updated return can only increase tax liability and involves payment of additional tax.
Q10. Can I use offline utilities to file ITR-U?
Yes, taxpayers can file ITR-U using both online and offline methods. The offline utility (JSON format) is available for download on the Income Tax Department’s website. Users can fill in their details, compute taxes, and generate a JSON file that can be uploaded to the portal after logging in. The online method is more convenient for most users as it allows direct entry, automatic validation, and quick e-verification. Platforms like TaxBuddy integrate directly with the e-filing system, offering a smooth online experience with pre-filled data and automated computations.
Q11. Is there any penalty for under-reporting income through ITR-U?
When income is voluntarily disclosed through ITR-U, the taxpayer is required to pay additional tax under Section 140B — 25% if filed within 24 months or 50% if filed after 24 months from the end of the assessment year. While this is not a traditional penalty, it serves as a self-corrective charge to promote early compliance. However, if intentional concealment, fraud, or misreporting is later detected, the taxpayer may still face further penalties or prosecution under other provisions of the Income Tax Act. Filing voluntarily through ITR-U helps avoid these harsher consequences.
Q12. Does filing ITR-U help avoid scrutiny or notices?
Yes, filing an Updated Return is one of the best ways to avoid future scrutiny or notices from the Income Tax Department. When income discrepancies or mismatches appear in Form 26AS, AIS, or TIS, the department may issue notices for under-reporting. Filing ITR-U voluntarily before such notices are generated demonstrates transparency and good compliance behavior. The department treats such cases leniently, as the taxpayer has already corrected errors without enforcement intervention. Filing through TaxBuddy further strengthens compliance since all AIS and TDS data are cross-checked before submission, reducing the risk of future mismatches or scrutiny.
