Missed your ITR? Here’s how ITR-U can help

July 25, 2026 Finance Talk Valli Sarvani

Filing an income tax return on time is important, but genuine mistakes can happen. Some taxpayers may miss the filing deadline, while others may later discover unreported income.

To address such situations, the Income Tax Department allows eligible taxpayers to file an Updated Income Tax Return (ITR-U) under Section 139(8A) of the Income-tax Act, 1961.

ITR-U enables taxpayers to correct omissions even after the deadlines for original, belated, and revised returns have passed. It is designed to encourage voluntary tax compliance and reduce disputes by giving individuals a chance to disclose additional income and pay the correct tax.

Moreover, taxpayers who failed to file their return or need to report extra income can use this facility, provided they meet the prescribed conditions.

However, ITR-U is meant only for correcting returns that increase tax liability. It cannot be used to reduce tax payable, claim a refund, or increase an existing refund.

The Finance Act, 2025, has also expanded the filing window. Eligible taxpayers can now submit an Updated Return within 48 months from the end of the relevant assessment year.

Previously, this period was limited to 24 months. Consequently, taxpayers now have more time to regularise their tax affairs.

However, not everyone can file an ITR-U. The option is unavailable if the updated return lowers tax liability, converts tax into a loss, or increases an existing loss.

Similarly, taxpayers facing certain search, survey, assessment, or investigation proceedings cannot use this provision. Other restrictions under Section 139(8A) also continue to apply.

Furthermore, filing an Updated Return involves paying more than the regular tax. Taxpayers must also pay applicable interest, fees, and an additional tax based on the delay.

The additional amount is 25% if filed within 12 months from the end of the assessment year. It increases to 50% for filings up to 24 months, 60% up to 36 months, and 70% up to 48 months.

To file an Updated Return, taxpayers must submit Form ITR-U along with the relevant income tax return form through the Income Tax Department’s e-filing portal after paying the required dues.

Tax experts recommend verifying eligibility before filing because the process involves additional tax and specific legal conditions.

Nevertheless, for taxpayers who genuinely missed reporting income or failed to file their return, ITR-U offers a valuable opportunity to become compliant without waiting for tax authorities to initiate action.

Image from Pxhere (Free for commercial use / CC0 Public Domain)

Image published on April 02, 2017