Income Tax Department Introduces ‘Discard Return’ Option for ITRs

Key Takeaways:

1. The ‘Discard Return’ feature can be used for ITRs filed for AY 2023-24 (FY 2022-23) and onwards.

2. It can be used multiple times, and there are no charges or fees for using this feature.

3. The original ITR filed must not be verified using any online or offline ITR verification methods.

4. If the subsequent return is filed after the due date under section 139(1) (of Income Tax Act, 1961), it would attract implications of belated return like section 234F (of Income Tax Act, 1961).

5. The ITR filing timelines would go on as they should irrespective of the fact that the individual has discarded their previously filed but not verified ITR.

The “Discard Return” feature offered by the Income Tax Department allows individuals to delete their previously filed unverified income tax return (ITR) and file a fresh ITR. This feature is particularly useful for correcting mistakes in the originally filed ITR without going through the process of filing a revised ITR. However, there are certain conditions and implications associated with using this feature.

Here are the key points to understand about the “Discard Return” feature:

Conditions for Using Discard ITR Feature

1. Applicable ITRs: The Discard ITR feature can only be used for ITRs filed for Assessment Year (AY) 2023-24 (Financial Year 2022-23) and onwards.

2. Multiple Usage: The feature can be used multiple times.

3. No Charges: There are no charges or fees for using this feature.

Pre-conditions for Using Discard ITR Feature

The original ITR filed must not be verified using any online or offline ITR verification methods.

The original ITR must be for AY 2023-24 (FY 2022-23) and onwards.

Implications of Using Discard ITR Feature

If the subsequent return is filed after the due date under section 139(1) (of Income Tax Act, 1961), it would attract implications of belated return like section 234F (of Income Tax Act, 1961).

It is advised to check whether the due date for filing the return under section 139(1) (of Income Tax Act, 1961) is available or not before discarding any previously filed return.

Example

If an individual has discarded their filed (but not verified) original ITR after the due date, and then files a fresh ITR, the filed fresh ITR would be considered as a belated ITR.

However, if the individual has discarded their filed (but not verified) original ITR before the due date and also filed a fresh ITR before the due date, then the filed ITR would be considered as an original ITR.

Filing Timelines and Verification

The ITR filing timelines would go on as they should irrespective of the fact that the individual has discarded their previously filed but not verified ITR.

An individual has 30 days to verify their ITR from the date of submission. If the individual misses the last date to verify their ITR, they can file a condonation delay request.

How to Use Discard Return Feature

Here are the steps to use the discard return feature as per the tax department’s FAQs:

1. Login to Income Tax e-Filing Portal.

2. Navigate to ‘e-File’ and select ‘Income Tax Return’ option.

3. Click on ‘e-Verify ITR’. There would be a button titled ‘Discard’.

FAQs Issued by Income Tax Department on Discard Return

The Income Tax Department has issued FAQs to provide further clarity on the Discard Return feature. These FAQs cover various scenarios and conditions related to using the feature.

For example, users can find information on when they can avail the Discard option, whether it can be availed multiple times, and the implications of discarding an ITR filed under different sections.

It’s important for individuals to fully understand the implications of discarding their unverified original ITR, such as the penalty for belated ITR and the limitations on carrying forward certain losses.

In conclusion, the Discard Return feature provides individuals with the flexibility to correct mistakes in their originally filed ITR without going through the process of filing a revised ITR. However, it’s crucial for individuals to be aware of the conditions and implications associated with using this feature.