Income Tax Return: New Forms Out, Which One Should You File?
Income Tax Return Form: The new financial year has officially kicked off today, April 1st. Along with it, the Income Tax Department has notified the fresh set of forms for taxpayers. It's time to figure out which form applies to you so you don't run into trouble with the taxman later.
New Delhi: The Income Tax Department has notified all Income Tax Return forms for the Assessment Year 2026-27. These forms will be used to report income earned between April 1, 2025, and March 31, 2026. For most individuals whose accounts don't require an audit, the deadline to file is July 31st.
There's a significant update this time: the ITR-1 (Sahaj) form now allows you to report income from two house properties. In the past, you’d have to jump to ITR-2 or ITR-3 for this. While ITR-1 and ITR-4 were notified on Monday, the department released ITR-2, 3, 5, 6, 7, and the updated ITR-U on Tuesday.
Which ITR form to file: Choose the Right One for Your Income
ITR-1 Form Also known as Sahaj, this is for individuals with a total income of up to 50 lakh rupees. You can use this if your earnings come from salary, up to two house properties, other sources like interest, or agricultural income up to 5,000 rupees. You can't use this if you have income from a business or profession.
ITR-2 Form This form is for individuals or Hindu Undivided Families (HUF) who aren't eligible for Sahaj. It’s the right choice if you don't have business profits but do have income from capital gains, such as selling shares or property.
ITR-3 Form If you are an individual or HUF earning from a proprietary business or a professional practice, this is your form. It's more detailed and covers complex business incomes.
ITR-4 Form Known as Sugam, this is for resident individuals, HUFs, and firms (excluding LLPs) with a total income up to 50 lakh rupees who opt for the Presumptive Taxation Scheme.
ITR-5, ITR-6, and ITR-7 Forms ITR-5 is designed for firms, Limited Liability Partnerships (LLPs), and Cooperative Societies. ITR-6 is for companies registered under the Companies Act. Lastly, ITR-7 is for trusts and charitable institutions.
ITR Filing Rules: Is it Mandatory if Your Income is Below the Limit?
According to Vivek Jalan, Partner at Tax Connect Advisory Services, even if your income is below the tax-free limit—2.5 lakh in the Old Regime and 4 lakh in the New Tax Regime—you might still need to file.
If your PAN shows more than 25,000 rupees in TDS for the year, or if you’ve deposited over 1 crore in a current account, filing is mandatory. The same applies if you’ve spent more than 2 lakh on foreign travel.
It’s easy to think you’re in the clear if you don't owe tax, but the rules are strict. Honestly, the best approach is to keep your records ready early. Don't wait until the July deadline to start looking for your Form 16 and bank statements. Staying ahead of the curve is the only way to ensure a smooth Income Tax Return filing experience.
Your email address will not be published. Required fields are marked *