Which ITR Should I File?

Income tax departments routinely issue various forms for filing the Income-tax return and there is always an ambiguity among the taxpayer about which form is to be filled while filing their ITR. Usually, the type of form you file depends on the type of income you earn but still with this article we would be comprehensively covering all the forms that the department has issued and how you can select those forms while filing the income tax return.

Following are the forms issued by the department:

ITR-1 SAHAJ: This form is meant for individuals who are being a resident (other than not ordinarily resident) (the concept of residency will be discussed in another article) having their total income up to Rs.50 lakh.

Source of Income (which can be shown): Income from Salaries/pension, Income from One house property, Income from other sources (such as Bank Interest, dividend etc..,) and Income from Agricultural income (where income is not more than Rs.5000).

The following person cannot use this form:-

1. Individual who is a director in a company
2. Individual who has invested in unlisted equity shares.
3. Individuals whose income is subjected to the TDS u/s 194N.
4. Individual who holds any asset outside India or who has signing authority in any account located outside India.
5. An individual who has an income from any source outside India.
6. An individual whose deduction of tax has been deferred on ESOP
7. Individual who has any brought forward loss to be carried forward under any head of income

ITR-2: This form is meant for Individuals and HUFs. This form is preferred by the individuals who are not eligible to file form ITR-1 Sahaj but are having the income from Salary/pension, capital gain, other income and income from more than one house property.

Example:  If a person has earned rental income from 2 properties and earns a salary too then he should file form ITR-2 rather than going for ITR-1 Sahaj.

Note: This form cannot be used by a taxpayer who has earned an income from profits and gains of business or profession.

ITR-3: This form is meant for individuals and HUFs who are not eligible to file their return in forms ITR-1 Sahaj, ITR-2 and ITR-4 and have earned their income from profits and gains of business or profession.

Example: Suppose a person has an income from salary, capital gain and business (not covered under the presumptive scheme) then in such case he should file form ITR-3 where he can show all his income earned.

ITR-4 SUGAM: This form is meant for Individuals, HUFs and Firms (other than LLP) being a resident and having a total income up to Rs.50 lakh and having an income from business and profession which is computed under sections 44AD, 44ADA or 44AE.

Source of Income (which can be shown): Income from Salaries/pension, Income from One house property, Income from other sources (such as Bank Interest, dividend etc..,), Income from Agricultural income (where income is not more than Rs.5000) and business or profession covered and computed under the presumptive scheme.

The following person cannot use this form:-

1. Individual who is a director in a company
2. Individual who has invested in unlisted equity shares.
3. Individuals whose income is subjected to the TDS u/s 194N.
4. Individual who holds any asset outside India or who has signing authority in any account located outside India.
5. An individual who has an income from any source outside India.
6. An individual whose deduction of tax has been deferred on ESOP
7. Individual who has any brought forward loss to be carried forward under any head of income

ITR-5: This form is meant for the following persons:-

1. Partnership Firm
2. Limited Liability Partnership (LLP)
3. Local authority
4. Association of Person (AOP)/ Body of Individuals (BOI)
5. Cooperative bank
6. Cooperative society
7. Society registered under the society registration Act, 1860 or any other Law
8. Primary agricultural credit society/cooperative bank
9. Rural development bank
10. Business trust, investment fund, Trust other than trust eligible to file Return in ITR 7
11. Any other AOP/BOI, artificial juridical, Estate of the deceased, Estate of the insolvent, Other AJP.

Note: This form cannot be filed by the persons who are required to file the return of income u/s 139 (4a) or 139 (4b) or 139 (4d).

ITR-6: This form shall be used by the companies to file their return (Except for the companies claiming exemption under section 11).

ITR-7: This form shall be used by the class of person who falls under section 139(4A) or section 139 (4B) or section 139 (4C) or section 139 4(D).

You can always visit our website www.akcoindia.com/blog  for reading such important information. And if you feel you need any assistance then you may just mail us at contact@akcoindia.com.

You may find our other blogs below:

Who should file an Income Tax Return (ITR)?: Click here
Annual Information System: Click here
All About 15CA 15CB: Click here

Source Info: https://www.incometax.gov.in/