Taxpayers can file updated returns before March 31 to correct past omissions.

They have to pay the due taxes, along with applicable interest and additional tax.

Filing updated returns (ITR-U) under Section 139(8A) will help taxpayers avoid potential scrutiny, penalties, or prosecution that may arise if undisclosed income is later detected by the tax authorities. The longer the delay in filing the updated return, the higher the additional tax burden.The additional tax is 25% of tax and interest if filed within 12 months from the end of the AY, 50% within 24 months, 60% within 36 months, and 70% within 48 months.

March 31, 2026 is the last date to file an updated return for AY21-22 (FY20-21), since the assessment year (AY) ended on March 31, 2022 and the four-year period ends on that day. “It is critical to act before the applicable slab expires or the window closes altogether,” says Sandeep Sehgal, partner, Tax, AKM Global, a tax and consulting firm.

Who should file

An updated return may be filed by any person who has made an error or inadvertently omitted certain income details in a previously filed return. This includes cases where the taxpayer has filed an original return, belated return, or revised return, but later discovers that certain income was not reported correctly.

Even one who failed to file the return altogether and missed both the original and belated return deadlines may file an updated return. “Updated returns may be filed in case of under-declaration of income, reporting income under the wrong head, payment of tax at an incorrect rate, or to reduce carried forward losses, unabsorbed depreciation, or tax credit claimed under Sections 115JB or 115JC,” says Neeraj Agarwala, partner, Nangia & Company. Only one updated return is permitted for each assessment year.

Who cannot file

Further, the facility cannot be used to file a nil return or loss return, to claim or enhance a refund, or where the updated return results in a reduction of tax liability.


One cannot file an updated return where enforcement proceedings have been initiated by the tax authorities, such as search proceedings under Section 132, survey under Section 133A, or requisition of books, documents, or assets under Section 132A. “An updated return cannot be filed where assessment, reassessment, revision, or recomputation proceedings are pending or have already been completed for that assessment year,” says Agarwala.

An updated return cannot be filed to claim a refund, declare a loss, increase an existing loss, or carry forward/set off losses. It is allowed only when it results in higher tax payable. “The intent of the provision is to enable voluntary payment of additional tax, not to reduce tax liability,” says Sehgal.

Amendment in Budget

The scope of filing an updated return has been expanded to cover  situations where the effect is to reduce the loss claimed in the original return and also in cases where it is furnished in response to a reassessment notice. The amendment is to come into effect from April 1, 2026.

In such reassessment cases, the taxpayer is required to pay an additional 10% of the aggregate tax and interest, over and above the existing additional tax depending on the year of filing. Further, income declared in such an updated return shall not attract penalty, provided the enhanced additional tax is paid.