Section 139(8A): Updated Return (ITR-U) Filing Guide 2025
- PRITI SIRDESHMUKH
- Dec 5
- 9 min read
Section 139(8A) of the Income Tax Act, 1961 allows taxpayers to correct or update their previously filed returns by submitting an Updated Return, known as ITR-U. Introduced in the Finance Bill 2022 and refined in Budget 2025, this provision ensures taxpayers can rectify errors, report missed income, and comply with tax obligations more accurately. The recent Budget 2025 changes have extended the filing window to 48 months and simplified compliance requirements, making it easier for individuals and businesses to stay tax-compliant.
Filing an Updated Return (ITR-U) enables taxpayers to revise income details, pay additional tax if necessary, and maintain transparent tax records under Section 139(8A) of the Income Tax Act.
Table of Contents
What is Section 139(8A) of the Income Tax Act
Section 139(8A) of the Income Tax Act introduces the concept of filing an Updated Return (ITR-U). This provision allows taxpayers to voluntarily update their income tax returns even after the due date or after filing an original, belated, or revised return. It provides an opportunity to disclose any missed income, correct reporting errors, or rectify omissions without facing immediate legal action. By offering this extended window, the government encourages voluntary compliance and reduces litigation related to income discrepancies.
Key Features of Updated Return (ITR-U) Filing
The Updated Return facility gives taxpayers two years from the end of the relevant assessment year to file corrections. ITR-U can be filed even if no previous return was submitted. It allows reporting of additional income and payment of taxes accordingly. However, it cannot be used to claim a refund, reduce tax liability, or carry forward losses. The taxpayer must also pay additional tax ranging from 25% to 50% of the total tax and interest payable, depending on when the ITR-U is filed.
Eligibility Criteria and Scope for Filing ITR-U
Any individual, HUF, company, or firm can file an Updated Return if they have omitted income, underreported earnings, or need to correct previous filings. The provision applies to residents and non-residents alike, provided they are not under investigation or have not received a notice for scrutiny or reassessment. Taxpayers can file an ITR-U even if they failed to file the original or belated return, as long as they declare all unreported income and pay the due taxes with applicable additional tax.
Time Limit for Filing Updated Return under Section 139(8A)
The time limit for filing an Updated Return is two years from the end of the relevant assessment year. For example, for FY 2023-24 (AY 2024-25), the ITR-U can be filed until March 31, 2027. The earlier it is filed within this two-year period, the lower the additional tax liability. Filing in the first year attracts an additional tax of 25% on the due tax and interest, while filing in the second year attracts 50%.
Process to File Updated Return (ITR-U) for FY 2024-25
To file ITR-U, the taxpayer must visit the official Income Tax e-filing portal, log in, and select “File Updated Return (ITR-U).” The form must be filed electronically and linked to the relevant financial year. The taxpayer should disclose the additional income, reasons for filing, and the computed tax payable under Section 140B. Once completed, taxes must be paid before submission, and proof of payment should be included.
Step-by-Step Guide to File Form ITR-U Online
Log in to the Income Tax e-filing portal using your PAN credentials.
Select the “File Updated Return (ITR-U)” option for the applicable financial year.
Enter details of additional income, sources, and reasons for filing.
Compute the additional tax payable as per Section 140B.
Pay the tax and record the challan details.
Fill in verification details and digitally sign the form (if applicable).
Submit and download the acknowledgment for your records.
Penalties, Interest, and Additional Tax under Section 140B
While filing an Updated Return, the taxpayer must pay the due tax, interest, and an additional tax under Section 140B. The additional tax is 25% of the total tax and interest if the return is filed within 12 months from the end of the relevant assessment year and 50% if filed between 12 and 24 months. If the tax liability is not cleared before filing, the return will be considered invalid. There are no provisions for refunds or carry-forwards through ITR-U.
Details Required in Form ITR-U (Including Bank Details and Verification)
The ITR-U form requires specific details such as the total additional income, category of income (salary, business, capital gains, etc.), and tax computation. The taxpayer must also provide bank account details, challan payment information, and verification details. The form asks for a self-declaration confirming that no proceedings under Sections 132, 133A, 148, or 263 are pending. Accurate disclosure is crucial, as incorrect or incomplete information can lead to penalties or scrutiny.
Updated Return vs Revised Return: Key Differences Explained
A Revised Return and an Updated Return serve distinct purposes in the income tax filing process, each designed to help taxpayers correct or disclose information at different stages. A Revised Return, governed by Section 139(5) of the Income Tax Act, allows taxpayers to correct errors or omissions in their originally filed return. This could include mistakes such as incorrect income reporting, missed deductions, or errors in personal details. The revised return can be filed any time before the end of the assessment year or within the extended due date announced by the government. There is no additional penalty or interest solely for revising the return, provided the revised version is filed within the allowed time frame and the tax liability, if any, is duly paid.
An Updated Return, introduced under Section 139(8A), is a more recent provision aimed at increasing voluntary compliance. It allows taxpayers to update their returns within two years from the end of the relevant assessment year, even if they missed the deadline for filing or revising the return. This facility enables individuals and businesses to disclose any unreported income or correct significant omissions that were not addressed earlier. However, an Updated Return cannot be filed to reduce the tax liability, increase a refund, or claim a loss that was not reported earlier. It is applicable only when additional income is being disclosed, resulting in higher tax payable.
The major difference between a Revised Return and an Updated Return lies in their timing, purpose, and financial implications. While a Revised Return helps in making corrections without additional cost, an Updated Return involves payment of an additional tax over and above the regular tax liability. The additional tax is 25% of the total due if filed within one year from the end of the relevant assessment year, and 50% if filed between one and two years. This acts as both a compliance incentive and a deterrent against non-disclosure.
In practical terms, taxpayers who realize their mistakes before the end of the assessment year should opt for a Revised Return to correct them without penalty. However, those who discover omissions or missed income after the revision deadline can use the Updated Return option. The key takeaway is that both provisions promote transparency in income reporting, but the Updated Return comes at an additional financial cost, while a Revised Return allows corrections within the regular compliance window without extra burden.
Who Cannot File an Updated Return under Section 139(8A)?
Certain taxpayers are restricted from filing ITR-U. These include those under search or seizure operations under Section 132, those facing reassessment or prosecution, and those involved in fraudulent claims or refund cases. Taxpayers who wish to declare a loss, claim a refund, or reduce taxable income cannot use ITR-U. Similarly, if the department has initiated proceedings for the same financial year, the taxpayer is barred from filing an Updated Return.
Common Mistakes to Avoid While Filing ITR-U
Common mistakes include incorrect computation of additional income, failure to pay taxes before submission, and incomplete disclosure of sources. Many taxpayers also incorrectly assume ITR-U can be used to revise refunds or carry forward losses. It’s important to ensure accurate reporting and complete payment under Section 140B before filing. Using a reliable tax platform such as TaxBuddy helps minimize errors through automated validation and expert review.
Benefits of Filing an Updated Return (ITR-U) in 2025
Filing an Updated Return offers a chance to stay compliant and avoid penalties or notices. It helps correct missed income disclosures, rectify errors, and maintain a clean tax record. Voluntary filing through ITR-U demonstrates good faith, reducing the chances of future scrutiny or prosecution. For FY 2024-25, it provides taxpayers an opportunity to declare additional income by March 31, 2028, with reduced penalties if filed early.
How TaxBuddy Helps in Filing Updated Returns under Section 139(8A)
TaxBuddy simplifies the ITR-U filing process through automated computation and professional support. The platform identifies income mismatches from AIS, Form 26AS, and TIS, calculates the correct additional tax under Section 140B, and prepares the ITR-U accurately. Expert-assisted plans ensure all disclosures meet compliance norms, avoiding potential penalties or rejections. The process is completely digital, ensuring fast, secure, and error-free filing for taxpayers.
Conclusion
Section 139(8A) of the Income Tax Act empowers taxpayers to voluntarily correct past returns and maintain compliance without fear of penalties. It fosters transparency and trust between taxpayers and authorities. For those looking to file an Updated Return efficiently and accurately, using expert-assisted platforms ensures smooth compliance.
For anyone looking for assistance in tax filing, it is highly recommended to download the TaxBuddy mobile app for a simplified, secure, and hassle-free experience.
FAQs
Q1. What is the time limit for filing an Updated Return under Section 139(8A)? An Updated Return (ITR-U) can be filed within two years from the end of the relevant assessment year. For instance, for Financial Year 2023-24 (Assessment Year 2024-25), the last date to file an ITR-U is March 31, 2027. This extended window allows taxpayers to correct omissions or report previously unreported income even after the original and revised return deadlines have passed.
Q2. Can an Updated Return be filed to claim a refund? No. An ITR-U cannot be used to claim a refund or to reduce an already reported tax liability. It serves solely to declare additional income and pay the corresponding taxes. If a taxpayer tries to claim an extra refund through ITR-U, the return will be treated as invalid.
Q3. How much additional tax must be paid when filing an ITR-U? When filing an Updated Return, taxpayers must pay an additional tax on top of the regular tax and interest. If the ITR-U is filed within 12 months from the end of the relevant assessment year, an additional 25 per cent of the total tax and interest is payable. If filed between 12 and 24 months, the additional tax rises to 50 per cent.
Q4. What happens if I don’t pay the tax before submitting ITR-U? The Updated Return will be treated as invalid unless the entire tax liability—including regular tax, interest, and additional tax—is paid in full before submission. Partial payments are not accepted, and unpaid dues will prevent acknowledgement of the return.
Q5. Can I file ITR-U if I am under scrutiny or reassessment? No. If your return is currently under scrutiny, reassessment, or if there are ongoing search or seizure proceedings, you are not eligible to file an ITR-U. The Updated Return is meant only for voluntary corrections, not for cases already under investigation.
Q6. Is there any restriction on who can file ITR-U? Yes. Taxpayers seeking to claim refunds, report losses, or decrease their total taxable income are not allowed to use ITR-U. It is strictly for those disclosing additional income that increases their tax liability.
Q7. How is ITR-U different from a revised return? A revised return is used to correct minor mistakes or omissions in a return already filed before the deadline. In contrast, an Updated Return can be filed even after the due dates to voluntarily disclose previously unreported income. However, ITR-U requires payment of additional tax as a penalty for late disclosure.
Q8. Can I file an Updated Return if I missed filing the original ITR? Yes. ITR-U can be filed even if you did not file an original or belated return. In such cases, you must include all sources of income, compute the total tax due, and pay the entire amount (including additional tax and interest) before submission.
Q9. What is the benefit of filing ITR-U voluntarily? Filing an ITR-U voluntarily allows taxpayers to correct their tax records, avoid scrutiny, and prevent penalties or prosecution for under-reporting. It promotes transparency and compliance by letting individuals regularize their income declarations before the tax department detects discrepancies.
Q10. Can businesses file an Updated Return? Yes. All types of taxpayers—including individuals, companies, firms, LLPs, and other entities—can file an Updated Return, provided no pending assessments or investigations exist for that period. Businesses often use ITR-U to report missed income or correct earlier reporting errors.
Q11. How can TaxBuddy assist with ITR-U filing? TaxBuddy simplifies the entire ITR-U process. Its AI-driven system auto-calculates additional tax, interest, and penalties, ensuring accurate computation. Experts review the filing to verify compliance and documentation, helping taxpayers submit error-free Updated Returns well within the prescribed deadline.
Q12. What are the consequences of not reporting additional income in time?
Failing to disclose additional income or file ITR-U within the two-year window may attract tax demands, interest, and heavy penalties. In cases of deliberate concealment, prosecution may also follow. Filing promptly through a reliable platform such as TaxBuddy ensures timely disclosure, accurate filing, and peace of mind.
