While delivering the Union Budget 2022, Finance Minister Nirmala Sitharaman made no changes to the taxation slab brackets. Meanwhile, the finance minister has granted some relief to those who have filed their updated Income Tax Return (ITR). In the event of fewer ITR filing. FM has declared that the amended tax filing screen will stay open for 2 years from the year of estimation.
ITR Filing under Budget 2022:
The income tax reporting requirements for normal taxpayers have been strengthened in Budget 2022. Taxpayers will now be able to file an amended tax return if they failed to declare specific income to the IRS while completing their original return.
They can pay an additional tax to amend their income tax returns (ITR) within 2 years after the completion of the appropriate assessment year. While changing the ITR, it should be noted that an extra tax will be paid on the extra revenue.
What will happen after the implementation of Budget 2022?
Individual taxpayers have until December 31 of the given fiscal year. In order to lodge an amended or belated return under current income tax legislation.
This extended time frame for ITR filing an amended return may not be sufficient for everyone. Budget 2022 included a provision to extend the deadline for filing delayed filings designed to motivate more people to file a tax return.
Union Budget 2022 recommended adding a new sub-section (8A) to Section 139 of the Income Tax Act of 1961 to give individuals greater time to file updated or late tax filings. The new law gives taxpayers 2 years from the completion of the relevant assessment year to disclose income to taxes. Additionally, if they failed to do so while completing the previous return.
It is planned to add a new clause in section 139 of the Act for any individual. Whether, someone has already submitted a return for the applicable assessment year or not, the Budget brief stated.
How much you must pay for the late ITR Filing?
If taxpayers file a late return within a year after the completion of the appropriate assessment year. As a result, an extra tax of 25% per year will be going to charge.
Budget 2022 also suggested charging a 50% surcharge if a tax filer updates their filings after a year but within two years. The extra tax is due on the interest and taxes owed on the extra revenue reported in the amended return.
How it will Benefit Taxpayers?
The latest anticipated law will assist income taxpayers in avoiding penalties for understating or false reporting income. The proposition for revised return over a time frame longer will be supplied in the current regulations of the Income-tax Act. However, it carry the use of large datasets with the IT Unit to a logical ending result in extra revenue realization. Moreover, it will enable ease of conformance to the taxpayer in a litigation-free surrounding, according to the Budget memo.
Read More: How To File ITR Online, a Step By Step Guide