You can now file updated tax returns for these assessment-years
What's the story
The Income Tax Department has announced the facility to file updated returns (ITR-U) for the assessment years (AY) 2021-22 and 2022-23 using ITR-3 and ITR-4 forms. The announcement was made on the department's official X handle. The provision of updated returns under Section 139(8A) of the Income Tax Act, 1961, enables taxpayers to correct mistakes/omissions in their original income tax returns or file a return if they missed the deadline.
Tax implications
Additional tax liability may apply
Taxpayers should also be aware that filing an ITR-U incurs an extra tax liability, which can go up to 50% of the extra tax and interest payable. This is a key consideration for those looking to file updated returns under this provision.
Form 1
Who can use ITR-3?
The ITR-3 form is applicable to individuals/Hindu Undivided Families (HUFs) with income from business or profession, share trading including futures and options, partnership in a company, unlisted equity shares, capital gains, and foreign assets/income. It also applies to the taxpayers whose income exceeds ₹50 lakh and who are not eligible to file ITR-1 (Sahaj), ITR-2 or ITR-4 (Sugam).
Form 2
Who can use ITR-4?
The ITR-4 form is designed for resident individuals, HUFs, and companies (excluding LLPs) with a total income of up to ₹50 lakh. It also covers the income from business or profession computed under presumptive taxation schemes (Sections 44AD, 44ADA, 44AE). The form permits the reporting of long-term capital gains under Section 112A up to ₹1.25 lakh. However, taxpayers who are directors in a company or hold unlisted shares cannot use this form.