Last date to file belated and revised income tax return is December 31: Act today or lose money

Tax

• December 31 is the last day to file belated or revised ITR for AY 2025–26
• From January 1, only updated returns allowed, with higher costs and penalties
• Updated returns cannot claim refunds or carry forward losses

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December 31 is the last day for taxpayers who have not yet filed their income tax returns for the current assessment year 2025–26. From tomorrow onward, friendly routes close, leaving taxpayers with only the updated return option, which comes with higher costs and penalties.

The Income Tax department is reaching out through email and SMS.

As the deadline nears, the Income Tax Department has intensified its outreach, issuing SMS and email alerts to individuals whose refunds are on hold due to data mismatches. In most instances, taxpayers have been advised to file a revised return by December 31 to rectify errors and clear the way for refund processing.

Pressure has also risen following increased scrutiny of returns flagged for excess refund claims, gaps between Form 16 and the Annual Information Statement, unreported political donations, and lapses in foreign asset disclosures. For many, uncertainty around which filing option applies has only added to the last-minute rush.

However, the Department has clarified that it is reaching out to affected individuals through text messages and emails as part of their ‘NUDGE’ program, a system designed to help rather than punish taxpayers who made mistakes.

What happens if you fail to file a return today?

“In case someone fails to file a belated or revised return by December 31, 2025, from January 1, 2026, he has to mandatorily file an updated return, and in certain situations it may attract penalty proceedings,” said Mehul Sheth, CA and Secretary of The Chamber of Tax Consultants.

The updated return extends the correction window far beyond the assessment year. Using the ITR-U form, taxpayers can file or update returns up to 48 months after the end of the relevant assessment year. So, for ITR filed in 2025 (AY: 2025-2026), the deadline for revised ITR will be till March 31, 2030.

Penalty/Interest: The additional tax payable on updated returns is 25 percent, 50 percent, 60 percent, and 70 percent applicable in the first, second, third, and fourth years, respectively. ITR-U once filed must be verified as well.

Set off, carry forward of losses, and refunds: An updated return is the most restrictive. It cannot be used to create, increase, or carry forward losses. Similarly, refund claims are not allowed.

How to file a belated return?

• Sign in to your account on the income tax e-filing portal.

• Click on ‘e-File’, select ‘Income Tax Returns’, and then choose ‘File Income Tax Return’.

• Choose the relevant assessment year.

• Select ‘Online’ as the filing mode and proceed further.

• Click on ‘Start New Filing’.

• Select the applicable filing status.

• Choose the appropriate ITR form.

• Open the ‘Personal Information’ section and verify that all details are accurate.

• Scroll to the filing details section and select Section 139(4) (belated return).

• Enter income details under the respective heads and complete the process by paying the applicable tax.