7 Forms of Income Tax Return: Which ITR should I file

The ITR form serves as a vital document for entities seeking tax exemption, including charitable trusts, or individuals with filing obligations. It plays a crucial role in ensuring compliance with tax regulations and facilitates the process of claiming exemptions or fulfilling specific requirements. Knowing the various forms of Income Tax Return is crucial, if you are a taxpayer.

What is Income tax return?

Income tax return (ITR) is a document filed with the Indian Income Tax department that details your income sources and taxes owed for a specific tax filing period. Different forms of Income Tax Return are designated for various taxpayer categories.

For example, ITR-1 for salaried individuals with basic income sources, ITR-2 for individuals with income from capital gains or foreign assets, and ITR-3 for businesses and professionals etc.

What are the various forms of Income Tax Return available?

The department has informed 7 different forms of Income Tax Return. Each taxpayer should file his ITR on or sometime recently the required due date. The choice of ITR form depends on factors such as the taxpayer’s income sources, total salary earned, and their taxpayer category (e.g., individuals, HUF, company).

Which ITR to file?

The taking after infographic will assist you discover out which forms of income tax return is appropriate to you for FY 2022-23. Once you figure out which ITR you wish, press on the links below to memorize more around them.

Let us look in detail on the different forms of Income Tax Return based on the categories i.e. ITR-1, ITR-2, ITR-3, ITR-4, ITR-5, ITR-6 and ITR-7.

ITR-1

ITR-1 or Sahaj is the simplest form for resident individuals with income solely from salary, pension, house property (rented out), and interest income.

This Return Form is for who’s the total income for the AY 2023-24 incorporates:

• Income from Salary/ Pension;
• Income from One House Property (barring cases where misfortune is brought forward from past a long time);
• Income from Other Sources (barring Winning from the Lottery and Income from Racehorses).
• Agricultural income up to INR 5000.

Who cannot utilize ITR-1 Form?

• Add up to income surpassing INR 50 lakh.
• Agricultural income surpassing INR 5000.
• On the off chance that you have got taxable capital gains.
• If you have got income from business or profession.
• Having income from more than one house property.
• If you’re the Director in a company.
• If you have got had investments in unlisted equity shares at any time amid the financial year.
• Owning assets (including financial interest in any entity) exterior India, including signing authority in any account found exterior India.
• If you’re a Resident Not Commonly Resident (RNOR) and non-resident.
• Having any foreign income.
• If you are assessable in regard of income of another individual in regard of which tax is deducted within the hands of the other individual.
• Tax deduction under Section 194N.
• In case in case payment or deduction of tax has been deferred on ESOP.
• On the off chance that you’ve got any brought forward misfortune or misfortune should be carried forward under any income head.

ITR-2

ITR-2 form is for individuals and Hindu Undivided Families (HUFs) with income from sources other than business or profession (like capital gains, foreign income).

This form is for whose total income for the AY 2023-24 incorporates:

• Income from Salary/Pension.
• Income from House Property.
• Income from Other Sources (counting Winnings from the Lottery and Income from Racehorses).
• On the off chance that you’re an Individual Chief in a company.
• If you have had investments in unlisted equity shares at any time amid the financial year.
• Being both a non-resident and a resident not often resident (RNOR).
• Income from Capital Gains.
• Having any foreign income.
• Agricultural income more than INR 5,000.
• Owning resources (counting financial interest in any entity) exterior India, including signing authority in any account found outside India.
• On the off chance that assess has been deducted under Section 194N.
• On the off chance that in case payment or deduction of tax has been deferred on ESOP.
• If you have got any brought forward loss or loss must be carried forward under any income head.

Additionally, this Return Form can be used if the assesses income is to be combined with that of another person, such as a spouse, kid, etc., and that additional income falls into any of the categories.

The whole income can be more than INR 50 Lakhs.

Who cannot utilize ITR-2?

This Return Forms of Income Tax Return ought to not be utilized by an individual whose total income for the AY 2023-24 incorporates Income from Business or Profession. For declaring these sorts of Income, you will need to utilize ITR-3 or ITR-4. To learn how to fill out the ITR-2 form, go through our in-depth instructions.

ITR-3

ITR-3 form caters to individuals and HUFs with income from business or profession, along with income from other sources (salary, house property, etc.). In other words, an individual or a Hindu Undivided Family that makes money from a private company or from practicing a profession must use the current ITR-3 Form.

The following individuals are eligible to submit an ITR-3 if they get income from them:

• Carrying on a business or profession.
• In case you’re a Person Director in a company.
• In case you’ve got had investments in unlisted equity shares at any time during the financial year.
• The return may incorporate income from House property, Salary/Pension and Income from other sources.
• Income of a person as a partner within the firm.

ITR-4

ITR-4 form or Sugam is a forms of Income Tax Return for small businesses and professionals availing the presumptive taxation scheme with turnover or gross receipts below specified limits.

The current ITR-4 is applicable to inhabitants who are HUFs, Partnership firms (except from LLPs), and whose total income includes the following:

• Revenue from businesses in accordance with section 44AD or 44AE’s presumptive income scheme.
• Professional income in line with area 44ADA’s presumed income scheme.
• Income from one residential property, not to exceed INR 50 lakh (excluding of the total amount of brought-forward loss or loss to be carried forward); • Income from a salary or pension up to INR 50 lakh.
• Income from other sources having income not more than INR 50 Lakh (barring income from lottery and racehorses).

If it’s not too much trouble note that any person earning income from the above-mentioned sources as a freelancer can moreover select for a possible conspire on the off chance that their gross receipts are not more than INR 50 lakhs.

A presumptive income scheme under sections 44AD, 44AE and 44ADA is when a person or an entity picks to infer its income on a presumptive premise, i.e. when the income is presumed at a least rate based on a percentage of net receipts / gross turnover or based on ownership of commercial vehicles.

However, if the business turnover surpasses INR 2 crore, the taxpayer will have to file ITR-3.

Who cannot utilize ITR-4 Form?

• If you add up to income surpasses INR 50 lakh.
• Having income from more than one house property.
• Owning any foreign asset.
• In the unlikely event that you are a director of a company;
• If you have ever invested in unlisted equity shares during the fiscal year;
• For residents not ordinarily resident (RNOR) and non-residents;
• If you have signing authority in any account located outside India;
• If you have income from any source outside India;
• If you’re assessable in respect of the income of another person in regard of which tax is deducted in the hands of the other individual.
• On the off chance that in case payment or deduction of tax has been deferred on ESOP.
• In case you’ve got any brought forward loss or loss must be carried forward under any income head.

ITR-5

ITR-5 is for firms, LLPs (Restricted Risk Organization), AOPs (Affiliation of People), BOIs (Body of Individuals), Fake Juridical Individual (AJP), Estate of deceased, Estate of insolvent, Business trust and investment fund to report their business or profession income and other income sources.

ITR-6

ITR-6 is designated for companies, excluding those claiming exemption under section 11 (Income from property held for charitable or religious purposes). This form is for companies (resident and non-resident) to report their business or profession income and other income sources.

This forms of income tax return needs to be filed electronically only.

ITR-7

ITR-7 form is a forms of income tax return for entities claiming tax exemption, like charitable trusts (if exceeding exemption limit) or persons with specific filing requirements. For individuals, including businesses, who are obligated to provide returns in accordance with Sections 139(4A), 139(4B), 139(4C), 139(4D), 139(4E), or 139(4F).

• Every person who receives income from property held in trust or from another legal obligation used exclusively for charity or religious purposes, or partially used for such purposes, is obligated to make a return under section 139(4A).
• If, after applying the rules of section 139A, a political party’s total revenue above the maximum amount that is exempt from income tax, it must make a return under section 139(4B).
• Return under section 139(4C) is required to be recorded by every –
• Scientific research association;
• News agency;
• Association or institution referred to in section 10(23A);
• Institution referred to in section 10(23B);
• Any hospital, fund, university, or other type of educational facility.

Can we file income tax return without Form16?

Yes, you can record an income tax return without Form 16.

Form 16 is basically for salaried people and provides details of the salary earned and Taxes Deducted at Source (TDS) by the employer.

In any case, taxpayers can record their returns utilizing other supporting documents such as salary slips, bank statements, investment proofs, etc., to declare their income accurately.

Conclusion

In conclusion, taxpayers who are paying their income tax return should be aware about the forms of Income Tax Return and the categories under each ITR form. Because this form holds significance for entities such as charitable trusts and individuals with unique filing needs, serving as a tool to assert tax exemption claims or meet specific regulatory obligations.

Its proper completion and submission are essential steps in navigating the complexities of tax compliance and securing the benefits entitled under the law. It is crucial to know different forms of income tax return.

Still confused about your ITR filing? You can directly reach out to 24efiling to get your income tax return filed on time. Our experts guide you in each step of the ITR filing process.

FAQs