Which ITR Form Applies to You — ITR-1 to ITR-7 Decided by Who You Are and Where Your Income Comes From, the Disqualifiers Most People Miss (Directorship, Unlisted Shares, Crypto, Foreign Assets, 194N, ESOPs), and What Happens When You File the Wrong Form

7 forms
ITR-1 to ITR-7 — four for individuals/HUFs, three for firms, companies and trusts
₹50 lakh
Total-income ceiling for ITR-1 and ITR-4
139(9)
A return on the wrong form is 'defective' — 15 days to fix after the notice, else treated as not filed
31 Dec
Last date to file a revised return on the correct form for the year
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Guide by BookMyCA's Chartered Accountants · pan-India serviceLast verified against official guidelines on 7 September 2026.

Video Explanation & Insights

Know your ITR form: applicability of income tax return forms 1 to 7

5 videos on this topic

Map

The seven forms at a glance

FormWhoIncome coveredNot allowed
ITR-1 SahajResident individual (ordinarily resident)Salary/pension, one house property, other sources, agricultural income up to ₹5,000, LTCG under 112A within the ₹1.25 lakh exemption; total income up to ₹50 lakhNRI/RNOR, HUF, business/profession, capital gains beyond the 112A exemption, two houses, foreign income/assets, director, unlisted shares, 194N TDS, ESOP deferral, brought-forward losses
ITR-2Individual or HUF without business/profession incomeEverything in ITR-1 plus capital gains, more than one house, foreign income/assets, income above ₹50 lakh, dividends of any size, lottery/gaming, crypto as investment, agricultural income above ₹5,000, partner's share of profit (exempt) is NOT hereBusiness or profession income (including F&O, intraday, crypto trading as business), partner's remuneration/interest
ITR-3Individual or HUF with business or professionAll heads: business/profession (audited or not), F&O and intraday, professional receipts, partner's remuneration and interest, plus salary, house property, capital gains, other sources; presumptive income can also be shown hereCompanies, firms
ITR-4 SugamResident individual, HUF or partnership firm (not LLP)Presumptive income under 44AD (business), 44ADA (profession) or 44AE (goods vehicles), plus salary, one house property, other sources; total income up to ₹50 lakh; LTCG under 112A within exemptionCapital gains beyond that, more than one house, foreign assets, director, unlisted shares, income above ₹50 lakh, agricultural income above ₹5,000, brought-forward losses
ITR-5Partnership firms, LLPs, AOPs, BOIs, estates, business trusts, investment fundsAll headsIndividuals, HUFs, companies, trusts filing ITR-7
ITR-6Companies (other than those claiming exemption under section 11)All heads, with audited accounts—
ITR-7Trusts, charitable and religious institutions, political parties, research associations, universities and hospitals filing under sections 139(4A)–(4D)Exempt-institution reporting—
Decision tree

Twelve questions that fix the form

  1. 1Are you a company? ITR-6. A trust or institution claiming exemption? ITR-7. A firm, LLP, AOP or BOI? ITR-5 (a partnership firm on presumptive income may use ITR-4).
  2. 2Are you a non-resident or RNOR? ITR-2 (or ITR-3 with business income) — never ITR-1 or ITR-4.
  3. 3Do you have income from business or profession — shop, freelancing, consultancy, F&O, intraday, commission agency, partner's remuneration? If you opt for presumptive taxation and total income is within ₹50 lakh → ITR-4; otherwise → ITR-3.
  4. 4Do you trade crypto as a business, or invest in it? Investment gains (taxed at 30% under 115BBH) go in ITR-2's Schedule VDA; trading as a business goes in ITR-3.
  5. 5Any capital gains beyond the 112A-exempt LTCG on listed shares/equity funds — sale of property, gold, debt funds, unlisted shares, short-term equity gains? → ITR-2 (ITR-3 if you also have business income).
  6. 6Do you own more than one house, or have a house-property loss to carry forward? → ITR-2.
  7. 7Are you a director in any company, or do you hold unlisted equity shares (including your own private limited company)? → ITR-2 at least.
  8. 8Do you have foreign assets, a foreign bank account, foreign income, or are you a signatory to a foreign account? → ITR-2 with Schedules FA and FSI; non-disclosure is a Black Money Act offence.
  9. 9Is your total income above ₹50 lakh? → ITR-2 (or ITR-3); Schedule AL (assets and liabilities) becomes mandatory.
  10. 10Was TDS deducted under section 194N on cash withdrawals, or did you defer tax on ESOPs from an eligible startup? → not ITR-1/ITR-4.
  11. 11Agricultural income above ₹5,000? → ITR-2 (with the rebate computation) or ITR-3.
  12. 12None of the above, resident, salary/pension plus one house and other sources within ₹50 lakh? → ITR-1.
Details

The forms most people get wrong

  • •ITR-2 for the salaried investor: a salaried person with any equity sale beyond the exemption, a second property, a directorship (even in a family company) or dividends plus foreign stocks (RSUs from a US employer are foreign assets) files ITR-2, not ITR-1 — Schedules CG, FA, FSI, TR and AL as applicable.
  • •ITR-3 for the trader: F&O and intraday are business income regardless of scale; turnover is computed from absolute profits and losses; a loss can be carried forward eight years only if the return is filed by the due date; audit applies above ₹10 crore turnover with 95% digital transactions (₹1 crore otherwise) or when profit is declared below the presumptive rate with income above the exemption.
  • •ITR-4 for the small business: 44AD (6% of digital / 8% of cash turnover up to ₹3 crore where cash receipts are within 5%), 44ADA (50% of gross receipts up to ₹75 lakh for specified professionals), 44AE (₹7,500 per vehicle a month; ₹1,000 per ton for heavy vehicles) — no books, no audit, but the whole presumptive income is taxed even if the real profit is lower, and opting out of 44AD locks you out for five years.
  • •Partners: the share of a firm's profit is exempt and reported in Schedule EI; remuneration and interest from the firm are business income → ITR-3.
  • •Pensioners: ITR-1 unless there is a second house, capital gains or income above ₹50 lakh; family pension is 'other sources'.
  • •HUF: ITR-2 or ITR-3 (or ITR-4 for presumptive business) — never ITR-1.
Wrong form

What happens when you file the wrong form

  1. 1CPC's processing detects the mismatch — a director filing ITR-1, capital gains reported as 'other income', a 194N TDS credit in ITR-1 — and issues a defective-return notice under section 139(9) with a 15-day window (extendable on request) to respond through e-Proceedings.
  2. 2Respond by filing the return afresh on the correct form as a response to the notice (or as a revised return under 139(5) before 31 December). If you do not, the original return is treated as invalid: no refund, no loss carry-forward, and the belated-return consequences follow.
  3. 3Under-reporting caught later (for example, ITR-1 hiding a property sale) invites reassessment and the 50%/200% penalties under section 270A; the AIS makes such omissions visible.
  4. 4A form that is 'too big' (ITR-2 filed when ITR-1 would do) is not defective — it is simply more work; when in doubt, the higher form is safe.
FAQs

ITR forms: questions we are asked

ITR-2 if the gains exceed the section 112A exemption of ₹1.25 lakh or include short-term or debt-fund gains; ITR-1 can carry only small exempt-range LTCG under 112A from this year.

No — directors and holders of unlisted shares file ITR-2 (or ITR-3 if there is business income).

ITR-4 under section 44ADA declaring 50% (or more) as income, if you are in a specified profession; otherwise ITR-3 with books.

No — F&O is business income; file ITR-3 by the due date to carry the loss forward for eight years, and check the audit threshold.

ITR-2 (income from house property and any interest); ITR-1 is not available to non-residents.

Yes — a twelve-point checklist on every return, and revised returns on the correct form where a defective notice has already arrived.