The Buyt Desk
The finance minister Nirmala Sitaraman made a big announcement in the Budget 2022 regarding the revised income tax return filing. The window for filing revised income tax will remain open for two years from the assessment year in case of wrong filing.
In her speech, she said,” I am proposing a new provision permitting taxpayers to file an updated return by paying additional tax. One can file the updated return within two years from the end of the relevant assessment year.”
What Is The Cost Income Tax Payers Have To Bear For Filing Updated Income Tax Return?
The finance minister has proposed that an amount equivalent to 25 per cent or 50 per cent as additional tax on the tax and due interest in the additional income shown would be charged.
It means, to report extra income, the tax payer has to pay an additional tax to come clean, along with interest on the amount up till furnishing the ITR. The calculation for the additional tax would be done in the form of a percentage. If the ITR is closed within 12 months, the payable interest percentage will be 25%, and within 24 months, the interest payable percentage will be 50%.
The step taken by the government has instilled a sense of fear in those taxpayers’ minds who were not filing the complete ITR. In the present time, the government do not have the required mechanism to gauge taxpayers who evade paying full tax or have not filed ITR for the areas that are not very significant. With this facility, the government has come up with the idea of giving a chance to taxpayers evading paying full tax to clear their balance sheet.
All taxpayers get the chance to revise their tax returns within the period of five months from the due date of ITR filing. Now, one can file the ITR within the period of two years from the declared assessment year.
Furthermore, One cannot file the updated return for the additional loss or reduced tax liability.
The person filing the updated tax return has to pay the tax. before the process, and all proof of delay has to be submitted.
