Union Budget 2022: Taxpayers can now update their income tax returns within 2 years of relevant AY

Taxpayers can file an updated return on payment of taxes within two years from the end of the relevant assessment, Finance Minister Nirmala Sitharaman announced while presenting the Union Budget 2022 in Parliament on February 1.

The time period for filing an updated return has been extended to provide taxpayers with an opportunity to errors made while filing taxes. It will provide a one-time window to correct omissions and anomalies in returns. 

Also Read: At 1 hour and 32 minutes, FM Nirmala Sitharaman makes her shortest budget speech

“Presently, if the department finds out that some income has been missed out by the assessee, it goes through a lengthy process of adjudication. Instead, with this proposal now, there will be a trust reposed in the taxpayers that will enable the assessee herself to declare the income that she may have missed out earlier while filing her return. Full details of the proposal are given in the Finance Bill,” the text of the finance minister’s budget speech explained.

Also Read: Union Budget 2022: A look at India’s most historic budgets

Presently, the deadline to update ITR is December 31, unless extended by the government.  

Sitharaman outlined “inclusive development, productivity enhancement, energy transition and climate action” as the “four pillars of the Budget.”

The Budget will be guided by the ‘PM Gati Shakti’ master plan and will benefit, youth, women, farmers, SCs and STs, she added. It seeks to lay the “blueprint” for the ‘Amrti Kal’ for the next 25 years, from “from India at 75 to India at 100”, Sitharaman said. 

Also Read: Economic Survey 2021-2022: Key highlights and takeaways

The Finance Minister did not announce any change in the income tax slabsfor 2022-23, while the income tax rates were also not revised.  FM announced that any income from transfer of any digital asset will be taxed at 30%. “No deduction in respect of any expenditure or allowance shall be allowed while computing such income, except cost of acquisition,” she added.   

The tone for the Union Budget was set by the Economic Survey 2021-22, which Sitharaman presented on Monday, projecting the economy to grow at a healthy 8-8.5% in the 2022-23 fiscal, down from the 9.2% growth for the 2021-22 forecast by the National Statistical Office (NSO).