HOW TO CHOOSE INCOME TAX RETURN FORM

There are different types of form to file income tax return but before filing return we have to choose appropriate return as nature of person and source of income. Following are the circumstances to choose appropriate form;

ITR-1 OR SAHAJ

 Persons eligible to choose ITR-1 or Sahaj

The person who can use this form is an Individual and whose total income for the financial year 2016-2017 includes:-

  • Income from Salary/ Pension;
  • Income from Other Sources;
  • Income from One House Property.

NOT ELIGIBLE FOR ITR-1

  • If total income more than ₹ 50 lakhs
  • If there is taxable income from Capital Gains
  • If there is income from Business or Profession
  • If you have Foreign Assets
  • If income from more than One House Property
  • If you have brought forward losses of previous years
  • If you have Other Source Income from winning Lottery and Race Horses.
  • If you have Agriculture income more than  ₹ 5000

 ITR-2

The person who can use this form is an Individual and whose total income for the financial year 2016-2017 includes:-

  • Income from Salary/ Pension;
  • Income from Other Sources (income from winning Lotter and Race Horses)
  • Income from One House Property
  • Income from Capital Gains
  • Foreign income/ Assets
  • Income of Person As a partner in the Firm
  • Agriculture Income more than ₹ 5000

The person who have income from Business or Profession shall not be eligible to file ITR-2

ITR-3

The person who can use this form is an Individual and HUF whose total income shall include for the financial year 2016-2017 includes:-

  • Salary/pension
  • House Property
  • Income from Other Sources
  • Proprietary business
  • Business or Profession

 The person who were filed ITR-4 in preceding financial year have to file ITR-3 from Financial Year 2016-17.

ITR-4

The form ITR-4s has been renamed as ITR-4, An Individual and HUF having income from a business of profession and who have opted for presumptive income scheme as per section 44AD, 44DA, 44AE of the income tax Act.

However, if the turnover of the business exceeds ₹ 2 crores the tax payer have to file ITR-3.

ITR-5

This form is to be filed by firms, LLP, AOPs (Association of person), and BOIs (Body of Individuals).

ITR-6

This form is for Companies other than the Companies claiming exemption under section 11 (Income from property held for Charitable or Religious purpose.

ITR-7

This form is to be filed by the person who have to file return under following condition;

  • Return under section 139(4A) is required to be filed by every person whose receipt of income derived from property held under trust or other legal obligation wholly for Charitable or religious purpose or in part only for such purpose.
  • Return under section 139(4B) is required to be filed by a political party if the total income without giving the effect to provision of section 139A exceeds the maximum amount which is not chargeable to income tax.
  • Return Under Section 139(4C) is required to be filled by following person –
  1. Scientific Research Association
  2. News Agency
  3. Association and institution refer to section 10(234A)
  4. institution refer to section 10(234B)
  5. Fund or Institution or University or Other Educational Institution or any Hospital or Medical Institution.
  • Return under Section 139(4D) is required to be filled by every University or Collage or Other Institution which is not required to furnish return of income or loss under any other provision of this section.

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