Finance Act 2022 has inserted a new section, Section 139(8A) in Income Tax Act. This new section provides for filing of ‘Updated Return’ by the taxpayers. The taxpayer can file an updated return within two years from the end of the relevant Assessment Year. However, effective April 1, 2025, an updated return can be filed within 48 months from the end of the relevant assessment year. Thus, in the financial year 2026-27, a person can file an updated return for Assessment Years 2022-23, 2023-24, 2024-25, and 2025-26.
Updated return can be filed irrespective of the fact, whether the original return was filed by the taxpayer or not. However, to file an updated return, the taxpayer has to meet the conditions prescribed in Section 139(8A) of the IT Act 1961, including:
1. The updated return can be filed only if the taxpayer has to disclose any additional income, which was missed / omitted earlier, and pay the additional tax thereon.

2. Updated return cannot be filed to reduce any income and report loss or increase the loss thereby resulting in reduction of tax liability or increase in tax refund. However, 

3. Where a person has furnished a return of loss under Section 139(3), he can furnish an updated return. However, such an updated return should be a return of income, or such an updated return has the effect of reducing the loss

4. The option of updated return can be opted only once for one assessment year.

5. If the updated return is being filed within 12 months from the end of the relevant assessment year, then an additional income tax of 25% and interest thereon shall be p
ayable. If the return is filed within 24 months, from the end of the relevant assessment year, then an additional income tax of 50% and interest thereon shall be payable. If the return is filed within 36 months, from the end of the relevant assessment year, then an additional income tax of 60% and interest thereon shall be payable. If the return is filed within 48 months, from the end of the relevant assessment year, then an additional income tax of 70% and interest thereon shall be payable.
This facility of filing an updated return can also be viewed as an opportunity to disclose the earlier missed income and pre-empt further proceedings under the I.T. Act.