Extended window to benefit late filers, global income earners

The Budget has proposed extending the time limit for filing a revised return from nine to 12 months from the end of the relevant tax year, or before completion of assessment, whichever is earlier. The proposal gives taxpayers more time to incorporate updated information and correct genuine errors.

This extension will come into effect from April 1, 2026 and apply from assessment year (AY) 2026-27 (FY 2025-26) onwards.

A taxpayer must pay a fee to file a revised return after December 31 but before March 31. “The fee will be ₹1,000 if income is up to ₹3 lakh, and ₹5,000 if it is above ₹5 lakh,” says Suresh Surana, a Mumbai-based chartered accountant.

What is a revised return?

A taxpayer may file a revised return if they report income incorrectly, miss any income or an income head, fail to claim a deduction or exemption, claim them incorrectly, compute tax incorrectly, give incorrect bank account details, or make other errors.

“Any taxpayer who filed an original return — whether on time or belated — can file a revised return. The law was changed from AY 2017-18, allowing even a belated return to be revised,” says Itesh Dodhi, director, Nangia & Co.

Who gains from the extension

Taxpayers often receive important documents — such as revised Form 16, TDS certificates, or proof of foreign income — after the original return deadline has passed. A longer window gives them adequate time to incorporate the information in these documents into their revised return.

Points to heed

A taxpayer should not wait for a notice for assessment or reassessment to revise. If they notice an omission or wrong statement, they should revise immediately to avoid litigation and penal provisions.

Dodhi suggests that taxpayers should keep documentation to justify the reason for the revision, in case the tax department raises a query later. If the revised deadline has passed, a taxpayer may file an updated return in certain cases.

“Additional tax and interest are payable due to the revision, taxpayers should pay them before revising,” says Dodhi.

A revised return is a corrective mechanism. “It is not an opportunity to make a fresh claim. It should not be used to fundamentally change the tax position taken earlier,” says Dodhi.

Finally, reconcile income with Form 26AS and AIS before revising the return.

Publication – Business Standard

By Itesh Dodhi

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