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When to fill which ITR form?
Category: Income Tax, Posted on: 06/07/2023 , Posted By: Aastha Nautiyal
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ITR 1 (also known as Sahaj)

Applicable for – Individuals (Total Income less than Rs. 50 Lakhs)

Eligibility –

  1. Income from Salary/ Pension
  2. Rental Income form 1 House Property
  3. Agricultural Income less than Rs. 5000
  4. Income from Other Sources (like saving bank interest, interest on FD, etc.)

Exceptions (Not Eligible if)

  1. Rental Income from more than one House Property
  2. Agricultural Income more than Rs. 5000
  3. Director in Company
  4. Authorized Signatory in Foreign Bank Account
  5. Foreign Income
  6. Holds shares in Unlisted Company
  7. Has Assets in foreign
  8. Beneficial Interest in Financial Organization
  9. Has Brought forward losses
  10. Earned Business Income
  11. Income from Capital Gain

If not eligible for this form, next comes ITR 2

ITR  2

Applicable for – Individuals/ HUFs

Eligibility –

  1. Income from Salary/ Pension
  2. Rental Income
  3. Capital Gain
  4. Income from Other Sources

Exception (Not Eligible if) –

Earned Business Income

Note - ITR 2 can be used by all those people who are not eligible to use ITR 1 except those who have Business Income.

If not eligible for this form, next comes ITR 3

ITR 3

Applicable for – Individuals/ HUFs

Eligibility –

  1. Income from Salary/ Pension
  2. Rental Income
  3. Capital Gain
  4. Business Income
  5. Interest income
  6. Income from Other Sources

Exception (Not Eligible if) –

Earned Business Income but not maintains books of accounts

Note – ITR 3 is to be filed if not eligible for using ITR 4

ITR 4 (also known as Sugam)

Applicable for – Individuals/ HUFs/ Partnership (But not LLP)

Eligibility – Presumptive Income (Presumptive Taxation Scheme)

ð  only for resident

Exceptions (Not Eligible if) –

  1. Rental Income from more than one House Property
  2. Agricultural Income more than Rs. 5000
  3. Director in Company
  4. Authorized Signatory in Foreign Bank Account
  5. Foreign Income
  6. Holds shares in Unlisted Company
  7. Has Assets in foreign
  8. Beneficial Interest in Financial Organization
  9. Has Brought forward losses
  10. Total Income is more Rs. 50 Lakhs


*Presumptive Taxation Scheme – To give relief to small taxpayers from the tedious job of maintenance of books of account and getting the books of account audited, the Income tax Act has framed the Presumptive Taxation Scheme under sections 44AD, 44ADA and 44AE of the Income Tax Act, 1961. The taxpayer adopting the Presumptive Taxation scheme can declare income at a prescribed rate instead. If a person opts for presumptive taxation scheme, then he is also required to follow the same scheme for the next 5 years. (Only for Resident)

Particulars

Section 44AD

Section 44ADA

Section 44AE

Applicable to person who is/ is engaged in
  • Individuals
  • HUFs
  • Partnership (not LLP)
  • Legal
  • Medical 
  • Engineering
  • Architecture
  • Accountancy
  • Technical consultancy
  • Interior Decoration
  • Other professions notified by CBDT
  • Plying, hiring or leasing of good carriage; and
  • Not owning more than 10 vehicles at any time during previous year.

Limitation

Total turnover or gross receipt in previous year does not exceeds Rs. 2 Crore

Gross receipts/turnover during the financial year does not exceed Rs. 50 Lakh

Does not own more than 10 goods carriages at any time during the year

Computation

Rate of 6% or 8% of turnover or gross receipts in a year

Rate of 50% of total gross receipt in year
  1. Heavy goods vehicle (gross weight >12 ton) = Rs. 1000 per ton of gross weight or unladen weight (every month or part of month)
  2. Other than heavy vehicle = Rs. 7500 (every month or part of month)

The Presumptive income computed as per the prescribed rate is the final income and no further deductions/expenditure for business/ profession/ income are allowed. However, under section 44AE, the firm can claim deduction on account of remuneration and interest paid to partners as allowable under Income Tax Act. Any person opting for the Presumptive Taxation scheme is liable to pay whole amount of advance tax on or before 15 March of the previous year. Under Section 44AE, no need to pay such advance tax.

(i)                  A person may voluntarily disclose his business income at rates more than those prescribed under section 44AD, 44ADA and 44AE.

(ii)                A person can declare his income at a rate lower than those prescribed under section 44AD, 44ADA and 44AE. However, then he is required to maintain the books of account and to get his accounts audited as prescribed under section 44AA or 44AB as the case may be.

ITR 5

Applicable for –  

  1. LLP (Limited Liability Partnership)
  2. AOP (Association of Persons)
  3. BOI (Body of Individuals)
  4. Local Authority
  5. Cooperative Society/ Banks
  6. Partnership Firm
  7. AJP (Artificial Juridical Person)

ITR 6

Applicable for –

All companies registered under the Companies Act 2013 or the earlier Companies Act 1956

ITR 7

Applicable for –

Charitable organizations (like Trusts, NPOs, etc.)


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