4-Year Window to Fix or File Income Tax Tax Returns: Know More:

4-Year Window to Fix or File Income Tax Tax Returns: Know More The Income Tax Department has officially introduced the updated return form, known as ITR-U. The income taxpayers are now able rectify or update their income tax returns as the window is extended for four years. This step follows the amendments made in the Finance Act, 2025. Earlier, the taxpayers used to get 24-month period to file their updated return from the end of the relevant assessment year. The Finance Act, 2025 has changed this period from 24 months to 48 months, helping individuals and businesses to correct their previous mistakes in the reported income.  

Why to File ITR-U?

By the help of ITR-U people will be able to fix their mistakes or file returns which they missed earlier. It gives taxpayers a chance to update their tax return in the following cases:

• If they didn't file the return earlier
• If some of the income was not reported correctly
• If the income was written under the incorrect category
• If earlier losses claimed are being reduced now
• If depreciation benefits claimed are being reduced now
• If the tax credit under sections 115JB/115JC is being lowered
• If the tax rate was incorrect

Extra Tax And Penalty

Income Tax Department has made a penalty system so that people file their ITR on time. The more you wait to file, the more you have to pay:

• You are required to pay 25% extra tax amount, if you file within 12 months after the end of the relevant AY
• You've to pay 50% extra tax if you file between 12 and 24 months
• You've to pay 60% extra tax if you file between 24 and 36 months
• If you file between 36 and 48 months, you're required to pay 70% extra tax

According to the PTI report, in last three years 90 lakh people updated their returns resulting in Rs. 8,500 crore extra tax for the government.