Budget 2022: New provision to allow Taxpayers to file an updated Income Tax Return

Budget 2022: New provision to allow Taxpayers to file an updated Income Tax Return The Finance Minister Nirmala Sitharaman is presenting her fourth Union Budget in Parliament in a paperless manner, like she did last year. The Union Finance Budget 2022 was presented on 1st February 2021 at 11:00 AM in the Lok Sabha The Finance Minister, Niramala Sitharaman while giving her budget speech has announced New provision for Taxpayers to file an updated Income Tax Return (ITR). A new provision to allow taxpayers to file an updated Income Tax Return (ITR) within two years of the relevant assessment year has been introduced in Budget 2022. “To provide an opportunity to correct an error, taxpayers can now file an updated return within 2 years from the relevant assessment year,” announced the finance minister in her Budget 2022 speech. A new sub-section (8A) in section 139 is proposed to be introduced to provide for furnishing of updated return under the new provisions in section 139, –– (a) It is proposed to insert sub-section (8A) in section 139 of the Act to provide that: (i) Any person, whether or not he has furnished a return under sub-section (1), sub-section (4) or sub-section (5), for an assessment year (herein referred to as the relevant assessment year), may furnish an updated return of his income or the income of any other person in respect of which he is assessable under the Act, for the previous year relevant to such assessment year, within twenty four months from the end of the assessment year. Such return shall be furnished in the prescribed form and manner and shall contain prescribed particulars. (ii) The proposed sub-section (8A) of section 139 shall not apply, if the updated return, is a return of a loss or has the effect of decreasing the total tax liability determined on the basis of return furnished under sub-section (1), subsection (4) or sub-section (5) or results in refund or increases the refund due on  the basis of return furnished under sub-section (1), sub-section (4) or subsection (5), of such person under the Act for the relevant assessment year.