Updated ITR Filing Window Proposed to Increase to 60 Months

The Taxation and Other Laws (Amendments) Bill, 2026 proposes to give taxpayers more time to correct omissions or disclose previously unreported income through an Updated Return. The proposed change would extend the maximum filing window from 48 months to 60 months from the end of the relevant tax year.

What Is the Proposed Change?

The Updated Return mechanism is intended to provide taxpayers with an opportunity to voluntarily correct their tax position after the normal return-filing and revision periods have expired.

Under the proposal, an Updated Return could be furnished within 60 months from the end of the relevant tax year, subject to the conditions prescribed under the law.

The proposal therefore adds a further 12 months to the existing 48-month window.

This change is part of the amendments proposed in the Taxation and Other Laws (Amendments) Bill, 2026. The Budget 2026 direct-tax proposals also describe the expanded Updated Return facility as part of the Government's broader objective of encouraging voluntary compliance and reducing tax litigation.

Why Is the Extension Important?

The additional time could be useful for taxpayers who discover an omission or incorrect disclosure after the earlier Updated Return window has substantially elapsed.

The proposal can help taxpayers:

• Voluntarily disclose income that was missed earlier.
• Correct eligible errors or omissions in earlier returns.
• Reduce the risk of prolonged disputes where voluntary correction is possible.
• Bring tax affairs up to date even after significant time has passed.

The proposal also forms part of wider reforms aimed at making the tax system more compliance-oriented and reducing unnecessary litigation.

Additional Tax Will Still Apply

The extended window does not mean that taxpayers can update returns without additional financial consequences.

Updated Returns continue to be subject to the applicable additional tax requirements. Under the proposed framework, the additional tax increases as the period between the end of the relevant tax year and filing of the Updated Return becomes longer. Professional analysis of the 2026 proposals indicates additional tax rates of 25%, 50%, 60% and 70% for successive filing periods, including the proposed 48-to-60-month window.

Therefore, taxpayers should not automatically wait until the final available period. Earlier voluntary correction may involve a lower additional-tax cost.

Important Point: The Bill Is a Proposal

The 60-month period should not be treated as an unconditional right until the relevant amendment is enacted and brought into force.

Taxpayers considering an Updated Return should:

1. Identify the income or disclosure that requires correction.
2. Recalculate the resulting tax and interest liability.
3. Check whether the case satisfies the statutory conditions for an Updated Return.
4. Compare the cost of filing now with the consequences of waiting.
5. Obtain professional advice where reassessment, assessment or other proceedings are already pending.

Conclusion

The proposed extension of the Updated Return filing window from 48 months to 60 months could provide taxpayers with a valuable additional opportunity to voluntarily correct omissions and disclose missed income. At the same time, the additional-tax cost and statutory eligibility conditions make timely professional review important.

As the measure is proposed under the Taxation and Other Laws (Amendments) Bill, 2026, taxpayers should verify the final enacted provisions before relying on the extended 60-month window.

For expert guidance on this topic, contact your tax professional today.