Taxpayers Alert! Missing This Deadline Could Cost You Heavily
The Income Tax Department has urged taxpayers to submit their Updated Income Tax Return (ITR-U) by March 31, 2025. Filing it within this deadline will incur an additional tax of 25%, whereas missing it will push the penalty up to 50%. Starting April 2025, the time limit for filing ITR-U will be extended to 48 months, but with stricter penalties.
The Income Tax Department is encouraging taxpayers to file their updated returns before March 31, 2025, to avoid hefty penalties and interest. ITR-U is a provision that allows taxpayers to rectify any missed income details or errors in their original, belated, or revised tax returns. However, delaying this process comes with financial consequences.
If a taxpayer submits their ITR-U by March 31, 2025, they will be required to pay an additional tax of 25% along with applicable interest. However, if they miss this deadline, the penalty jumps to 50%, significantly increasing their financial burden.
From April 2025 onwards, the window to file ITR-U will be extended to 48 months. However, the longer you wait, the higher the penalty you will have to bear. Here’s how the additional tax burden will escalate:
1-12 months delay: 25% additional tax
12-24 months delay: 50% additional tax
24-36 months delay: 60% additional tax
36-48 months delay: 70% additional tax
For example, if your tax liability is ₹1 lakh and you file after a 12-month delay, you will need to pay an extra ₹25,000. If delayed beyond 24 months, this amount increases to ₹50,000, and further delays will only worsen the penalty. Filing on time helps avoid unnecessary financial stress.
According to data presented in the Lok Sabha, as of February 28, 2025, a total of 4.64 lakh ITR-U filings have been completed, amounting to ₹431.20 crore in tax collection. In comparison, during the previous assessment year (2023-24), approximately 29.79 lakh ITR-U filings were recorded, contributing ₹2,947 crore in tax payments.
Act Before March 31, 2025: Filing before this date saves you from paying a 50% penalty.
Avoid Additional Interest & Tax: A delayed filing will increase your financial liabilities.
Use ITR-U to Rectify Errors: If you missed any income details in your previous return, this is your chance to correct them.
Stay Updated on Rules: From April 2025, the extended 48-month filing period comes with even higher penalties.
Taxpayers must take this deadline seriously to avoid unnecessary penalties and interest. Procrastination can be costly, so it is wise to act fast and ensure compliance with tax regulations. Filing ITR-U on time not only saves money but also keeps you in good standing with the tax authorities.
Stay informed, act early, and file your returns before March 31 to secure peace of mind!
