Which ITR Form Should I File ?

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Generally, people do not have a clear vision as to under which category they should file their ITR. Here is some useful information to guide you through all confusion.

What does the ITR stands for?

ITR is an abbreviation commonly used to describe Income Tax Return.

What does it mean?

Income Tax Return is the form in which an assessee files information about his Income and tax thereon to Income Tax Department. There are various forms like ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6 and ITR 7.

Who is Assessee?

The term assessee is considered as the person who is supposed to pay tax.

Who is Person?

As per S.2(31) of Income Tax Act, 1961, unless the context otherwise requires, the term “person” includes:
  1. an individual,
  2. a Hindu undivided family,
  3. a company,
  4. a firm,
  5. an association of persons or a body of individuals, whether incorporated or not,
  6. a local authority, and
  7. every artificial juridical person, not falling within any of the preceding sub-clauses.

Which ITR should I file?

There are 7 forms of ITRs forms as provided by Income Tax Department. And recently Finance Minister Arun Jaitley has introduced a new form of ITR for Individuals having taxable income up to Rs 5,00,000 can just fill up a simple one-page form for filing their tax returns.
 

If total income for an individual includes:ITR-1 (Sahaj)

  • Income from salary or pension; or
  • Income from 1 house property (excluding cases where loss is brought forward from previous years); or
  • Income from Other Sources (excluding winning from Lottery and Income from Race Horses) and does not have any loss under the head
Then ITR-1 should be used by an individual.

Note:

In a case where the income of another person like spouse, minor child, etc. is to be clubbed with the income of the assessee, this Return Form can be used only if the Income being clubbed falls under the above income categories.

Who cannot use this form?

This Return Form should not be used by an Individual whose Total Income includes:
  1. Income from more than one House Property; or
  2. Income from winnings from Lottery or income from Race Horses; or
  3. Income under the head “Capital Gains”, e.g., short-term capital gains or long-term capital gains from sale of house, plot, shares etc.; or
  4. Agricultural income in excess of ₹ 5,000; or
  5. Income from Business or Profession; or
  6. Loss under the head ‘Income from other sources’; or
  7. Person claiming relief under section 90 and/or 91; or
  8. Any resident having any asset (including financial interest in any entity) located outside India or signing authority in any account located outside India or
  9. Any resident having income from any source outside India

ITR-2

If total income for an individual or a Hindu Undivided Family includes:
  1. Income from Salary / Pension; or
  2. Income from House Property; or
  3. Income from Capital Gains; or
  4. Income from Other Sources (including Winning from Lottery and Income from Race Horses).
Then ITR-2 should be used by an individual or a Hindu Undivided Family.

Note:

In a case where the income of another person like spouse, minor child, etc. is to be clubbed with the income of the assessee, this Return Form can be used where such income falls in any of the above categories.

Who cannot use this form?

This Return Form should not be used by an Individual or a Hindu Undivided Family whose Total Income for assessment year includes Income from Business or Profession.

ITR-2A

If total income for an individual or a Hindu Undivided Family for the includes:
  1. Income from Salary / Pension; or
  2. Income from House Property; or
  3. Income from Other Sources (including Winning from Lottery and Income from Race Horses).
Then ITR-2A should be used by an individual or a Hindu Undivided Family.

Note:

In a case where the income of another person like spouse, minor child, etc. is to be clubbed with the income of the assessee, this Return Form can be used where such income falls in any of the above categories.

Who cannot use this form?

This Return Form should not be used by an Individual or a Hindu Undivided Family whose Total Income for assessment year includes:
  1. Income from Capital Gains; or
  2. Income from Business or Profession; or
  3. Any claim of relief/deduction under section 90, 90A or 91; or
  4. Any resident having any asset (including financial interest in any entity) located outside India or signing authority in any account located outside India; or
  5. Any resident having income from any source outside India.
ITR Forms
ITR-3,4,4S
 

ITR-3

The ITR-3 Form particularly applies to those Individuals and Hindu Undivided Families who are registered as Partners in a firm. As per Rule 12 of the Income Tax Rules this form does not apply to those who are Proprietors of a firm. It is mainly for the business which includes partnership deals. It is also applicable for professionals but it should be a partnership profession.

Who can use this form?

The eligibility criteria of every Income Tax Return form are governed by a set of rules and conditions. The ITR-3 Form is applicable only to those Individuals and Hindu Undivided Families that can be placed under the following categories
  • Is a Partner in a firm
  • Gains Income through ‘Profits or gains of business or profession’
  • Gains Income by means of interest, salary, bonus, commission, remuneration, as a partner

Note:

If the partner of a firm only earns income from the firm as a share in the profits and not by any other means such as interest, bonus, salary, remuneration, or commission etc. then such an Individual or Hindu Undivided Family should file Income Tax Returns using only the ITR-3 Form, and not the ITR-2 Form.

Who cannot use this form?

Individuals and Hindu Undivided Families who are not eligible to fill the ITR-3 Form are those who have earned Income through a Business or Profession operated as a Proprietorship firm. Assessees, who apart from being a partner in a firm, also have sources of income from a business or profession, including the speculation market, are also not eligible to file their Income Tax Returns through this form.

ITR-4

This Return Form is to be used by an individual or a Hindu Undivided Family who is carrying out a proprietary business or profession.

Who can use this form?

Assessees whose total income includes:
  • Income from business or profession
  • Eligible for Presumptive Business Income but where Turnover/Gross Receipts exceeds Rs. 1 crore
  • Return may include Salary/Pension
  • Income from House Property
  • Income from Other Sources

ITR-4S (Sugam)

The SUGAM ITR-4S Form is a Presumptive Income Tax Return Form and is part of the Income Tax Returns Filing process with the Income Tax Department of India.

Who can use this form?

This Return Form can be used by Individual/HUF whose total income includes:
  • Business income where such income is computed in accordance with special provisions referred to in section 44AD and 44AE (i.e. on presumptive basis)
  • Income from salary/ Pension
  • Income from one house property (excluding cases where loss is brought forward from previous years)
  • Income from other sources (Excluding winning from lottery and income from race horses)

Note:

In a case where the income of another person like spouse, minor child, etc. is to be clubbed with the income of the assessee, this Return Form can be used where such income falls in any of the above categories.

Who cannot use this form?

An important factor to take note of before filing Income Tax Returns through the SUGAM ITR-4S Form is that this Form is not to be used by any Individual or Hindu Undivided Family that fulfills any of the following criteria:
  • Holds any assets outside the country
  • Has any financial interest in a foreign entity
  • Is a signing authority in any bank account that is located outside the Indian Territory
  • ITR 4S has been released for AY 2014-15, 2015-16 and 2016-17 by Income Tax Department
 
ITR Forms
ITR-5,6,7

 

ITR-5

This form of ITR is particularly used by firms, LLPs, AOPs (Association of persons), BOIs (Body of Individuals), artificial juridical person, cooperative society and local authority.

ITR-6

This form is used by Companies other than companies claiming exemption under section 11(i.e. those companies whose income from property is held for charitable or religious purposes) must furnish their income tax must in ITR-6 Form.

Note:

This return has to be filed electronically only.

ITR-7

This Form can be used by persons including Companies who are required to furnish return under section:
  • 139(4A) – Charitable & Religious Trust or
  • 139(4B) – Political Parties or
  • 139(4C) – Hospitals, Medical institutions, schools, colleges and other specified institutions referred to in section 10 or
  • 139(4D) – university, college and institutions referred to in sec 35(1)(ii) & sec 35(1)(iii) or
  • 139(4E) – Business Trust or
  • 139(4F) – Investment fund referred to in sec 115UB.
 

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