Updated return vs Revised return

The Indian government announced an option for taxpayers to correct their income tax returns via the new updated return. As the name suggests, this return allows taxpayers to correct any omissions or errors in their income tax returns, discovered after the time limit for filing the revised return has lapsed.

Updated return can be filled with in two years from the end of relevant assessment year.

So what is the difference between updated return and revised return?

1. Updated return can be filed even if you have not filed your original return, while revised return cannot be filed without filing the original return.

2.Updated return can be filed only if there is an additional tax liability, while revised return has no such restrictions.

3. While there are no penalties for filing a revised return, an updated return carries a penalty of 25-50% of the tax liability.

4.An updated return can only be filed if it results in the assessment of additional tax liability – that is, if the update reduces your tax outgo, or results in a return of loss, you cannot file it.

5. It is worth noting that you can file an updated return even if you did not file the original return.