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Which ITR Form Should You File? A Guide for Every Taxpayer
A big error in tax filing is using the wrong ITR form. The Income Tax Dept turns away returns that use the wrong form. A turned-away return means filing again before the deadline. This is stressful. The good news: the right form is usually clear once you know what each one is for.
ITR forms at a glance
| Form | Who uses it |
|---|---|
| ITR-1 (Sahaj) | Salaried individuals, one house property, other sources up to ₹5,000 |
| ITR-2 | Individuals and HUFs with income from more than one house property, capital gains, or foreign assets |
| ITR-3 | Individuals and HUFs with business or professional income |
| ITR-4 (Sugam) | Individuals and HUFs with business income computed under presumptive taxation (Sections 44AD, 44ADA, 44AE) |
| ITR-5 | Firms, LLPs, AOPs, BOIs |
| ITR-6 | Companies (not filing ITR-7) |
| ITR-7 | Companies and persons filing under Sections 139(4A), 139(4B), 139(4C), 139(4D) |
ITR-1 (Sahaj): the most common form
ITR-1 is the simplest form. Most people who file as individuals use it. You can use ITR-1 if ALL of the following are true:
- Your income is from pay or pension
- You have income from one house property (and it is under ₹60,000 a year after cuts)
- Other income (interest, dividends) is under ₹5,000
- You are not a director in a company
- You do not have capital gains
- You do not have foreign income or assets
- You do not live in another country
A salaried person with only pay income, a standard cut, and savings account interest uses ITR-1.
ITR-2: when ITR-1 is not enough
Use ITR-2 if any of these apply:
- You have income from two or more house properties
- You have capital gains (from selling shares, mutual funds, property, and so on)
- You have foreign assets or foreign income
- You are a director in a company
- You had more than one employer in the same year
- You claim relief under a double taxation treaty
If you sold shares or property in FY 2026-27, you must use ITR-2. This is true even for a long-term gain of just ₹5,000.
ITR-3: for business and freelance income
ITR-3 is for people and HUFs who run a business or do freelance work. This includes:
- Freelancers and consultants (even without a formal business registration)
- Commission agents
- Doctors, lawyers, chartered accountants with private practices
- Anyone with a proprietary business
Note: ITR-3 needs you to keep books of accounts. You must show them if the Income Tax Dept asks. If your sales are over ₹60 lakh (or ₹75 lakh if you get paid by digital modes), you must have your accounts audited under Section 44AB.
ITR-4 (Sugam): presumptive taxation
ITR-4 is for people and HUFs whose business pay is taxed under the presumptive scheme — Sections 44AD, 44ADA, and 44AE.
You can use ITR-4 if your business has:
- Sales up to ₹3 crore (₹2 crore if not on the new tax regime) under Section 44AD
- Professional pay up to ₹75 lakh under Section 44ADA
- Transport with up to 10 goods vehicles under Section 44AE
Under presumptive taxation, you state your pay at a flat rate. It is usually 6% for digital payments and 8% for cash payments. You do not need to keep detailed books. Small traders and kirana shops often use this.
Example: a small shop with ₹40 lakh in yearly sales can use ITR-4 and state 6% of that (₹2.4 lakh) as net business pay.
ITR-5 and ITR-6: for entities
ITR-5 is for partnership firms, LLPs, AOPs, and BOIs. ITR-6 is for companies. Both need more detail than individual forms.
ITR-7: for special entities
ITR-7 is for charitable trusts, political parties, institutions, and colleges that do not pay tax under Section 10.
How to file the right ITR form
The Income Tax Dept fills in most of the ITR form for you. It uses your PAN, TDS data in Form 26AS, and AIS. Always check the pre-filled data before you submit. Errors in pre-filling are not your fault. But using the wrong form is.
Why ITR forms get rejected:
- Using ITR-1 when you have capital gains → use ITR-2
- Using ITR-4 when your real income is less than the flat rate (you can state less, but must keep books)
- Not telling about foreign bank accounts or assets (you must say even if the balance is zero)
- Form 26AS and your declared TDS do not match
The filing portal at incometax.gov.in checks the form before you submit. It flags clear mismatches so you can fix them.
Sources
- Income Tax Act 2025, Section 139 — filing of income tax returns (verified 7 October 2026).
- ITR forms and instructions — Income Tax Department e-filing portal (verified 7 October 2026).
- Presumptive taxation — Sections 44AD, 44ADA, 44AE, Income Tax Act 2025 (verified 7 October 2026).
Related reading
- Income Tax Act 2025 — what changed this year — Act changes affecting your return
- Income Tax Calculator — estimate tax before filing — check your tax outgo before choosing the regime