Income Tax Returns (ITRs)
Total 7 ITRs are notified by the Income Tax Department, which are applicable for different assessee and for their specified income.
One has to identify, which ITR form is suitable for filing his/her Income Tax Return. ITR may be different from previously filed return for the same person, if source/type of income is different from previous year.
ITR-1
Who can file ITR- 1?
Eligible assessee: Resident Individual, excluding;
-an individual who is either a Director in a company or has invested in unlisted equity shares (ITR-2 or ITR-3 is applicable).
Type of Income: Following type of income can be declared under ITR-1, popularly known as form ‘SAHAJ’.
- Salary or Pension.
- One House property, If income from more than one house property then ITR–1 is not applicable (and ITR-3 is applicable).
- Income from other sources, like interest from term deposit.
- If total income is upto Rs. 50 lakh (if more then Rs 50 lakh, then ITR-2 is applicable).
- If Agriculture income is less then Rs. 5000 (If Rs. 5000 or more than , ITR-2 is applicable).
Explained: What is Total Income?
Total Income is Gross Total Income (GTI) - applicable Deductions
Gross Total Income (GTI) = Income from all head of Income (viz. Salary, house property, business and profession, capital gain and other sources).
ITR-2
Who can file ITR- 2 ?
Eligible assessee: Individual and Hindu Undivided Family (HUF)
Type of Income: Following type of income can be declared under ITR-2:
- If total income is more than Rs. 50 lakh.
- If income from Capital Gain.
- Any foreign income.
- Agriculture Income, if more than Rs. 5000.
Simply said, ITR-2 is applicable for the Individuals and HUF, who is not eligible to file ITR-1 and who is not having any income under the head 'Profit or gains of business and profession'.
ITR-3
Who can file ITR-3 : Individual and HUF1. Income from Business/Profession (except, where ITR- 4 is applicable)
2. Income from firm (as a partner)
3. Who is not eligible to file ITR -1 (SAHAJ), ITR-2 and ITR- 4 (SUGAM).
Individual or HUF having type 1, 2 and 3 (as above) income and also have income from Salary/ Pension/Income from Other Sources/Income From House property and Income from Capital gain, then also this form is applicable.
ITR-4 (SUGAM)
Who can file ITR- 4:
1. Resident Individual or Resident HUF,
2. A (Resident) firm (other than Limited Liability Partnership/LLP)
3. Total Income does not exceeds Rs. 50,00,000/-
Type of Income:
1. Income from business where income is computed on presumptive basis under:
- Section 44AD (gross turnover is upto Rs. 2 crore)
- Section 44AE ( income from goods carriage upto 10 vehicles)
2. Income from profession where income is computer on presumptive basis under:
- Section 44ADA (gross receipts upto Rs. 50 lakh).
[These are certain provisions under Income Tax Act for small business and professionals, where they can declare income at specified rate/(or higher rate also) on gross turnover/ total receipts and pay tax accordingly].
Now, Who is not eligible for ITR- 4
- An individual who is either a Director in a company or,
- Has invested in unlisted equity shares.
ITR-5
Who is eligible to file ITR-5:
All, except:
- Individual,
- HUF,
- Company,
- Person filing ITR-7
For example: Firms, LLPs, AOPs (Association of persons) and BOIs (Body of Individuals), Artificial Juridical Person (AJP), Estate of deceased, Estate of insolvent, Business trust and investment fund etc.
ITR-6
Who is eligible:
Companies, who is not claiming exemption under section 11 of the Income Tax Act (ITR-7 is applicable).
[Section 11 pertains to relaxation regarding property held for charitable and religious purposes].
ITR-7
Who is eligible to file:
This return is applicable for persons and companies, who are required to file their IT return under following section of Income Tax Act:
- Section 139 (4A): Income from property held for charitable and religious purposes.
- Section 139 (4B) : Retuun for political parties.
- Section 139 (4C) : Association, new agency etc.
- Section 139 (4D) : University, institution etc.
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