Types-of-Income-Tax-Return

Which Type of Tax Return Do I File?

Which Type of Tax Return Do I File?

An Income Tax Return is a communication made every financial year by a taxpayer to the Income Tax Department. The purpose of making the communication is to inform the Income Tax Department about the details of taxable income and tax payable pertaining to the taxpayer. Before the taxpayer can begin Income Tax E-Filing it is important to understand which type of income tax return is applicable. There are totally seven types of Income Tax Returns. The purpose of the present article is to discuss each of the seven different types of income-tax returns.

ITR-1 Form (SAHAJ)

A taxpayer can file using ITR-1 Form if the taxpayer is an individual who satisfies the following criteria:

  • The income obtained by the assessee is limited to the sources mentioned below :
    • Income from Salary or Pension
    • Income from Only One House Property
    • Income from other sources
  • The annual income of the taxpayer is less than ₹ 50 Lakhs
  • The taxpayer does not have any foreign assets
  • The taxpayer does not have any agriculture income that exceeds ₹ 5,000
  • The taxpayer does not have any taxable capital gains
  • The taxpayer does not have any income from Business or Profession
  • The taxpayer does not have any casual income such as winnings from lotteries, card games and horse races

Know more about ITR-1 Form.

ITR-2 Form

A taxpayer can file the return using ITR-2 Form if the assessee is filing as an individual or as a HUF (Hindu Undivided Family) that satisfy the below criteria :

The taxpayer’s source of income is limited to the items mentioned below :

  • Income from Salary or Pension
  • Income from House Property (any number)
  • Income from Capital Gains
  • Income from Other Sources (including Winnings from Lottery and Income from Race Horses).
  • Income of a person as a partner in the firm (income from proprietary business needs to be filed through ITR-3)
  • Foreign Assets and Foreign income
  • Agricultural income more than ₹ 5,000

Also, ITR-2 Form can be used to file the return if the taxpayer’s income crosses ₹ 50 Lakhs. Know more about ITR-2 Form.

ITR-3 Form

An assessee can file using ITR-3 Form if filing as an individual or as a HUF (Hindu Undivided Family) that satisfy the below criteria :

  • Income from a proprietary business or from carrying on profession
  • Income from other sources mentioned in ITR-2 may also be included along with income from proprietary business or from carrying on profession

ITR-4 Form – SUGAM

The taxpayer can file using ITR-4 Form if found to satisfy the criteria mentioned below:

  • Income from a proprietary business or from carrying on profession under the Presumptive income scheme as per Section 44AD, Section 44ADA and Section 44AE of the Income Tax Act
  • If the turnover of the business mentioned is within ₹ 2 crores. If turnover exceeds ₹ 2 Crores, ITR-3 Form needs to be used

ITR-5 Form

The taxpayer can file using ITR-5 Form if found to satisfy the criteria mentioned below:

  • The taxpayer is filing as a Firm, Limited Liability Partnership (LLP), Association of Persons (AOP) or Body of Individuals (BOI) Income from a proprietary business or from carrying on profession under the Presumptive income scheme as per Section 44AD, Section 44ADA and Section 44AE of the Income Tax Act.
  • The taxpayer is not required to file the return of income under section 139(4A) or 139(4B) or 139(4C) or 139(4D), i.e., Charitable and Religious Trust, in which case ITR-7 is to be used.

ITR-6 Form

This form can be used if the assessee is filing a return of a company and not claiming exemption under Section 11. Companies claiming exemption under Section 11 are those deriving income from property which is held for charitable or religious purpose.

ITR-7 Form

Charitable and religious trusts which are claiming an exemption from tax under Section 11 of the Act should use this form to file the return. However, the exemption under the Act cannot be denied merely because the assessee has failed to furnish the return on or before the due date.

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