1.0 Background:
The Income-tax Act, 1961 provides multiple timelines and mechanisms for filing income-tax returns to balance taxpayer convenience with compliance discipline. For taxpayers who miss the original due date under Section 139(1), the law traditionally allowed a belated return under Section 139(4) and a revised return under Section 139(5) within a specified cut-off date. However, once these statutory timelines lapse, one of the remedial mechanisms available is the Updated Return (ITR-U) under Section 139(8A).
For Assessment Year (AY) 2025–26, the due date to file a belated or revised return is 31 December 2025, provided the assessment has not been completed earlier. After this date, taxpayers must evaluate whether filing an ITR-U is appropriate.
2.0 Belated Return under Section 139(4)
A belated return allows a taxpayer to file the return after the original due date but before 31 December of the relevant assessment year (or before completion of assessment, whichever is earlier). This route is generally preferable where available, as it permits:
- Claiming eligible deductions and exemptions,
- Carry forward of specified losses (subject to conditions),
- Revision of the return under Section 139(5), if required,
- Avoidance of additional tax burdens specific to ITR-U.
However, after 31 December 2025, filing a belated return for AY 2025–26 is statutorily barred, making this option unavailable.
It is pertinent to note that a belated return filed within the permissible window may further be revised under Section 139(5), offering flexibility to correct errors or omissions. However, this option is strictly time-bound. For AY 2025–26, no belated return can be filed after 31 December 2025, making this route unavailable thereafter.
3.0 Updated Return under Section 139(8A)
The Updated Return mechanism was introduced to promote voluntary tax compliance even after the expiry of the belated and revised return timelines. Under Section 139(8A), a taxpayer may file an updated return within 48 months from the end of the relevant assessment year, subject to prescribed conditions.
However, the scope of filing ITR-U is restricted. An updated return cannot be filed to declare a loss, to carry forward losses, or to claim or increase a refund. Further, ITR-U is not permitted where assessment, reassessment, search, survey, or prosecution proceedings have already been initiated for the relevant year.
Additionally, filing an ITR-U entails the taxpayer to pay not only the applicable tax and interest but also an additional tax as follows:
| Timeline for furnishing Updated Return | Additional Tax | Additional Tax |
| 12 months from the end of the relevant AY | 25% of Additional tax (Tax + Interest) | 25% of Additional tax (Tax + Interest) |
| 24 months from the end of the relevant AY | 50% of Additional tax (Tax + Interest) | 50% of Additional tax (Tax + Interest) |
| 36 months from the end of the relevant AY | – | 60% of Additional tax (Tax + Interest) |
| 48 months from the end of the relevant AY | – | 70% of Additional tax (Tax + Interest) |
4.0 Belated Return vs Updated Return (ITR-U): Key Differences for AY 2025–26
| Particulars | Belated Return | Updated Return (ITR-U) |
| Relevant provision | Section 139(4) | Section 139(8A) |
| Purpose | Filing return after missing original due date | Voluntary filing or correction after expiry of belated/revised return timelines |
| Last date for AY 2025–26 | 31 December 2025 (or before completion of assessment, whichever is earlier) | Within 48 months from the end of AY 2025–26 |
| Availability after 31 Dec 2025 | Not available | Available |
| Can be revised further | Yes (under Section 139(5), within timelines) | No revision permitted |
| Declaration of loss | Permitted (subject to conditions) | Not permitted |
| Carry forward of losses | Limited (certain losses not allowed if belated) | Not permitted |
| Claim of refund or Increase in refund | Permitted | Not permitted |
| Additional tax / penalty | Late fee under Section 234F and applicable interest | Additional tax under Section 140B (25%–70% of tax + interest, depending on delay) |
| Applicable when proceedings initiated | Not permitted if assessment completed | Not permitted if assessment/reassessment/search/survey initiated |
5.0 Which Option Is Preferable After 31 December 2025?
For AY 2025–26, once time limit for belated return (i.e.31 December 2025) has elapsed, then a belated return cannot be filed, and taxpayers are generally left with 2 limited alternatives i.e. filing an ITR-U or seeking condonation of delay from the tax authorities.
Condonation of delay may be sought under Section 119(2)(b), wherein the Central Board of Direct Taxes (CBDT) is empowered to admit applications for exemption, deduction, refund, or other relief (such as delayed return filing) even after the expiry of statutory timelines, provided the taxpayer demonstrates genuine hardship. However, condonation is at the discretion of the revenue authorities.
On the other hand, ITR-U offers a statutorily defined and time-bound route for voluntary disclosure at a higher tax cost and with restrictive conditions. Accordingly, taxpayers should prioritise filing returns within the belated return window wherever possible. Post-deadline, ITR-U should be viewed as a corrective and risk-mitigation mechanism, while condonation of delay should be reserved for exceptional cases involving genuine hardship.
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