Types of ITR Forms in India
Filing income tax returns (ITR) is a mandatory process for individuals, businesses, and organizations in India whose income exceeds the threshold limits set by the Income Tax Department. To cater to the diverse types of taxpayers, India has multiple Income Tax Return (ITR) forms, each designed to meet specific income sources and tax complexities. Choosing the correct ITR form is crucial to ensure accurate and hassle-free filing.
Overview of Different Types of ITR Forms
India’s Income Tax Department provides seven primary ITR forms, each tailored to different taxpayer categories. Here’s an in-depth look at each ITR form and its relevance.
1. ITR-1 (Sahaj)
- Who Should Use It: Resident individuals with a total income up to ₹50 lakhs.
- Applicable Income Sources:
- Salary or pension income.
- Income from a single house property (excluding cases of carry forward losses).
- Income from other sources (interest income).
- Exclusions: Individuals with foreign assets, agricultural income exceeding ₹5,000, or income from capital gains.
Ideal For: Salaried individuals with simple income sources.
2. ITR-2
- Who Should Use It: Individuals and Hindu Undivided Families (HUFs) with income from sources other than business or profession.
- Applicable Income Sources:
- Salary or pension income.
- Income from multiple house properties.
- Capital gains.
- Foreign income and assets.
- Agricultural income over ₹5,000.
- Exclusions: Taxpayers with income from business or profession.
3. ITR-3
- Who Should Use It: Individuals and HUFs with income from business or profession.
- Applicable Income Sources:
- Income from business (sole proprietorship) or profession.
- Salary or pension income.
- Income from house property and capital gains.
- Exclusions: Those without business or professional income.
Ideal For: Self-employed individuals, professionals, and business owners with diverse income sources.
4. ITR-4 (Sugam)
- Who Should Use It: Individuals, HUFs, and firms (other than LLPs) opting for presumptive taxation under Sections 44AD, 44ADA, or 44AE, with a total income up to ₹50 lakhs.
- Applicable Income Sources:
- Income from business or profession under presumptive taxation.
- Salary or pension income.
- Income from one house property.
- Exclusions: Taxpayers with complex income sources like capital gains or foreign assets.
Ideal For: Small business owners and professionals availing of presumptive taxation.
5. ITR-5
- Who Should Use It: Partnerships (including LLPs), Association of Persons (AOPs), Body of Individuals (BOIs), and other entities.
- Applicable Income Sources: All income sources applicable to firms and associations.
- Exclusions: Individual taxpayers and HUFs.
Ideal For: Partnerships, LLPs, and associations not classified under other forms.
6. ITR-6
- Who Should Use It: Companies (excluding those seeking exemptions under Section 11 for charitable or religious purposes).
- Applicable Income Sources: Income relevant to corporations, including business profits, capital gains, and other sources.
Ideal For: Registered companies that do not claim exemptions under charitable purposes.
7. ITR-7
- Who Should Use It: Entities like charitable trusts, political parties, research institutions, and other organizations filing under Sections 139(4A), 139(4B), 139(4C), or 139(4D).
- Applicable Income Sources: Income types relevant to organizations claiming exemptions under specific tax sections.
Ideal For: Charitable trusts, political parties, and research institutions seeking tax exemptions.
How to Choose the Right ITR Form
Selecting the correct ITR form depends on several factors:
- Income Source: Your primary income source (salary, business, capital gains, etc.) largely determines which form to use.
- Tax Complexity: If your tax situation involves multiple income sources, foreign assets, or presumptive income, choose an ITR form that accommodates these complexities.
- Entity Type: Different forms apply to individuals, HUFs, firms, companies, and non-profit organizations.
- Income Tax Act
- Income Tax Login
- Income Tax Return
- Income Tax e-Filing
- Income Tax Refund
- Income Tax Slabs
- Types of ITR Forms
- Income Tax Online Payment
Income Tax Return Due Dates
