Find Out Which ITR Form Is Required For Your Income Tax Filing

Filing your ITR is not just important but also a legal requirement. It provides the Income Tax Department with details about your income and taxes paid.

The last date to submit your Income Tax Return (ITR) for the assessment year 2024-25 in India is July 31, 2024. If you file after this date, you'll incur a late fee of Rs. 500 per month or part thereof, up to a maximum of Rs. 1,000.

It's mandatory to file an ITR if you earned income from or invested in foreign assets during the financial year. When applying for visas or loans, having an ITR filed is crucial. Whether your business made a profit or incurred losses, filing your ITR is a legal obligation. 

If you've experienced business losses or undercapital gains, you can only carry them forward to the next year if you file your return before the due date.

Help me decide which ITR form to file

For the Financial Year (FY) 2023-24, which corresponds to the Assessment Year (AY) 2024-25, the type of Income Tax Return (ITR) form that should be filed depends on the nature of your income.

Here are the common ITR forms used for individuals:

ITR-1, also known as Sahaj, is a simplified Income Tax Return form intended for resident individuals with a total annual income of up to Rs. 50 lakh. It is suitable for individuals who earn income from sources such as salary, pension, one-house property, or other sources (excluding specific categories).

ITR-2 is an extensive income tax return form for individuals and HUFs. It applies to those with diverse income sources, including income from capital gains, foreign income, or agricultural income over Rs. 5,000. Eligible individuals include directors of companies, residents not ordinarily resident (RNOR), or non-residents. It also covers those with investments in unlisted equity, assets abroad, or obligations like tax under Section 194N or ESOPs, and allows for carrying forward losses from previous years.

ITR-3 is tailored for individuals and Hindu Undivided Families (HUFs) involved in proprietary businesses or professions. It is suitable if you engage in a business or profession requiring bookkeeping or audit, are a director in a company, or have investments in unlisted equity shares during the financial year. It covers income from house property, salary or pension, other sources, and as a partner in a firm. If you don't fit ITR-1, ITR-2, or ITR-4 criteria, ITR-3 is the appropriate choice.

ITR-4, also known as Sugam, is a simplified Income Tax Return form suitable for residents who are individuals, Hindu Undivided Families (HUFs), and partnership firms (excluding LLPs). It applies to those with specific income sources, including:

• Business or professional income under presumptive taxation schemes (Sections 44AD or 44ADA).
• Income from one residential property, not exceeding Rs. 50 lakh (excluding carried forward losses).
• Salary or pension income up to Rs. 50 lakh.
• Other sources of income up to Rs. 50 lakh (excluding lottery and race-horse winnings).

Freelancers earning within these thresholds can opt for presumptive taxation if their gross receipts are under Rs. 50 lakh.

ITR-5 is a comprehensive Income Tax Return form for various entities such as firms, LLPs, AOPs, BOIs, AJPs, estates, business trusts, and investment funds, accommodating diverse business structures and legal entities under Indian tax regulations.

ITR-6 is the specific Income Tax Return form for companies under the Companies Act 2013 or earlier versions, excluding those exempt under Section 11 for income from charitable or religious property. It ensures compliance with tax filing requirements for non-exempt corporate entities.

ITR-7 is an extensive income tax return form intended for specific entities mandated to file returns under sections 139(4D), 139(4A), 139(4B), 139(4C), 139(4E), and 139(4F) of the Income Tax Act. This includes companies, political parties with taxable income, scientific research associations, news agencies, educational institutions, business trusts, and certain investment funds under Section 115UB.