Taxpayers now have the option to delete their previously submitted but unconfirmed Income Tax Returns (ITRs) thanks to a critical feature that the income tax (I-T) department added to its website. Previously, only errors or omissions could be corrected on the ITR by taxpayers.
Users can now “Discard ITR” for unverified original, late, or altered ITRs beginning with the assessment year 2023–2024 thanks to a new option added to the income tax portal. This is an excellent decision on the part of the income tax department, as it will provide people more room to amend their income tax return beyond simple omissions and errors. Its continued legality, meanwhile, may be questioned given that there is now no legal option for the ITR to be deleted.
What is the “Discard” ITR option?
If you “discard” your tax return on the income tax return filing website, www.incometax.gov.in, it will be permanently removed from the Income Tax Department’s records and the taxpayer will not be able to get it back.
Getting rid of your ITR is a really simple process: Visit www.incometax.gov.in, the income tax website, log in, and select the e-filing option. Choose Income Tax Return from there, then e-verify your ITR. You can choose to discard your return here.
Only income tax returns submitted on or after April 1, 2023 are eligible to use this new option. This indicates that it applies to the 2022–2023 fiscal year (Assessment year 2023–2024). As previously mentioned, you may only dispose of your IT return if it has not been confirmed (either electronically or by mail to the CPC). The trash option is still unavailable if your ITR verification was sent to CPC but has not yet been received.
The introduction of an online option to trash income tax returns that have not been properly checked and were filed for tax years 2022–2023 is a good move for taxpayers. Such replies can be discarded several times.
It will be especially helpful to those who discovered an error or omission in their tax return after filing. They can now “discard” the unverified tax return and file a new one, rather than first e-verifying it and then making revisions.
How is Discard ITR different from Revised ITR?
Even if a taxpayer discovered a mistake after filing, they still had to check the income tax return until the Income Tax Department offered the Discard Income Tax Return option.
One cannot access the ITR portal to amend their tax return until the ITR has been verified.
The saved but unverified ITR will be entirely removed from the Income Tax Department’s website if it is discarded. Accordingly, it would require the taxpayer to file a new return. This will have consequences since it will be viewed as a belated return if the new return is filed after the July 31 deadline each year.
For example, let’s say you file your income tax return on July 25 without checking it. On August 10, you throw away the return and file a fresh income tax return. Since this revised return was filed after the July 31 deadline, it would be regarded as a belated return and could result in penalties. However, there are no legal repercussions if you have confirmed your ITR and subsequently file a revised return after July 31.
Taxpayers who file their returns in July and decide to “discard” the unverified return in August should carefully consider their options.
Read More: ITR U Guide – Filing an Updated Return under Section 139(8A)
This is the case because, once abandoned, a return is deemed to have never been filed; hence, any subsequent filing will be subject to a Rs 5,000 late filing fee, and the taxpayer will not be permitted to carry forward any losses suffered during the year.”
If the initial return was submitted before the deadline and is discarded, a new return must be filed afterward without incurring a penalty cost; otherwise, a penalty fee will be charged for the later return.The option to delete any tax return that is unverified or undergoing verification is only accessible until the tax year 2022–2023 deadline, which is December 31, 2023.