Welcome. In this post, we will be talking about Income Tax Return or ITR. We will be taking a look at:
We discuss all the ITR forms but feel free to skip to which you want. If you want to know which ITR to file, then we suggest reading from the beginning to figure out which fits your income.
In summary, ITRs 1 to 4 are applicable for individuals and HUFs; ITR-5 for Firms, LLPs, AOPs (Association of persons) and BOIs (Body of Individuals); ITR-6 for Companies and ITR-7 for Trusts.
What is ITR?
ITR is a short form of Income Tax Return. It is the form using which a person declares his income and the tax applicable on that income to the Income Tax Department (ITD). The person who files these returns is called an assessee.
An assessee can be an individual person or company. Before filing, you have to know the type of assessee you are. Here is a table which is helpful.
Action point: Take out your PAN card and see which is the 4th character. Match it with the below table to find out which type of assessee you are.
|Fourth Character of PAN||Status of Assessee|
|H||Hindu Undivided Family|
|A||Association of Person|
|B||Body Of Individuals|
|J||Artificial Judicial Person|
Which ITR should you file?
ITR-1 filing is done by an individual/HUF who has the following types of income:
- Income from salary/pension
- Income from a single house property
- If the loss is brought forward from previous years, then ITR-1 is not applicable
- Income from other sources (excluding winning a lottery and income from horse race)
- Other sources include fixed deposits, family pension among others.
- The income can be from any and all of these sources.
- ITR-1 is not applicable if your total income exceeds Rs. 50 Lakhs.
- ITR-1 covers only a single house property. In case the number of house properties increases, then ITR-1 will not be applicable.
- ITR-1 is not applicable for the RNORs (Resident, not ordinarily resident) and the non-residents.
ITR-2 is applicable if an individual or a Hindu Undivided Family has income from the following sources:
- House Property
- Capital Gains i.e., a profit made from the sale of property or an investment
- Other Sources (including lottery winnings and income from Race Horses)
- Agricultural income more than Rs 5,000
You can also file ITR-2 when considering the income of another person such as spouse or child.
- Any person having income from Business or Profession cannot file ITR-2.
- The person having income from a Partnership firm cannot file ITR-2.
- Provision to quote details of TDS deducted in Form 26QC (Section 194IB) is given.
ITR-3 is applicable if an individual or a Hindu Undivided Family has income from the following sources:
- Business or Profession
- Income from Salary / House Property / Other sources
- Agricultural income
ITR-4 is applicable for individuals/ HUFs whose income is from businesses which fall under the presumptive tax scheme under the following sections:
Note: ITR-4 is not applicable for NRIs.
ITR-5 is applicable for firms, Limited Liability Partnerships (LLPs), Association of Persons (AOPs) and Body of Individuals (BOIs), Local Authority (LA) and Local Judiciary Persons (LJPs).
ITR-6 is applicable for companies other than those claiming an exemption under section 11 i.e., Income from property held for charitable or religious purposes.
Note: It is mandatory to file ITR-6 electronically with the digital signature.
ITR-7 is applicable for the following:
- All individuals who obtain income from a trust
- All individuals who receive income for the sole purpose of charity or a religious offering
- Any political party that earns a net income that is more than the ceiling limit that is exempt from income tax
- Associations that carry out scientific research
- News organizations and companies
- Organisations as mentioned in Section 10(23A) and Section 10(23B)
- Educational institutions such as school, colleges or universities
- Medical institutions such as hospitals, clinics etc