The Income Tax Return

Income Tax Return (ITR) is the document through which the Income earned during a Financial Year and the Income Tax Payable thereon is intimated to the Income Tax Department by the Assessee. The Income and tax payable is declared through self assessment of tax. Earlier the ITR were filed by means of paper returns and now, in the online era, the paper returns have been replaced by e-returns and the long queues in from of income tax office have been replaced by the online filing through income tax efiling portal. You may also be interested in learning on Internal Auditing and Management Consultancy in Kerala

Who should file ITR

As per the provisions of Income Tax Act, Individuals and HUF having a total income exceeding the Basic Exemption Limit shall file the Income Tax Return before the due dates prescribed. The Basic Exemption limits prescribed in case of various categories of Individuals are as follows.

• Individuals aged below 60 years of age – Rs.2.5 Lacs
• Individuals aged from 60 to 80 years of age – Rs.3 Lacs
• Individuals aged above 80 years of age – Rs.5 Lacs

Other than those covered above, the following assesses also need to file Income Tax Return.

• If there is any income tax refund eligible from the departments.
• If you have foreign income or invested in foreign assets during the financial year.
• If you need to apply for visa or get a loan.
• In case of companies and firms whether they make profits or loss.

Even if you’re not covered in any of the categories mentioned above, you’ll need to file ITR mandatorily if

• An aggregate amount exceeding Rs.1 Crore has been deposited into one or more current bank accounts.
• An aggregate expenditure exceeding Rs.2 Lac has been incurred on foreign travel.
• An aggregate expenditure exceeding Rs.1 Lac has been incurred on electricity consumption.

Types of ITR

Based on the level of income, head of income and type of taxpayer, the ITR applicable changes. There are broadly 7 types of ITR ranging from ITR-1 to ITR-7. Now let’s check in detail about the different types of ITR and their applicability.

ITR-1 or SAHAJ

ITR 1 is applicable to resident individuals whose total income for the FY includes any or more of the following incomes:

• Income from salary/ pension;
• Income from one house property (excluding cases where loss is brought forward from previous years);
• Income from other sources (excluding Winning from Lottery and Income from Race Horses)
• Agricultural income upto Rs.5,000.

ITR 1 is not applicable in the following cases and other ITRs should be opted for

• Total income exceeding Rs. 50 Lacs.
• Agricultural income exceeding Rs.5,000.
• Total income includes taxable capital gains.
• Total income includes income from business or profession.
• There are incomes from more than one house property.
• In case of directors of a company.
• If there is investment(s) in unlisted equity shares at anytime during the financial year.
• If there is ownership in assets (including financial interest in any entity) outside India which includes signing authority in any account located outside India.
• In case of a Non-Resident or a Resident but Not Ordinarily Resident.
• In case of possessing foreign assets or having foreign income.
• In cases where the income includes income of another person for which the tax is deducted in the hands of another person.

ITR-2

ITR-2 is applicable in case of Individual and HUF where the total income includes any or more of the following:

• Income from Salary/ Pension;
• Income from House Property;
• Income from Other Sources(Including Winnings from Lottery and Income from Race Horses)

(The total income from above sources should exceed Rs.50 Lacs.)

• In case of director(s) of a company.
• In case of shareholders of unlisted company at anytime during the financial year.
• In case of Non-Residents and Resident but Not Ordinarily Resident.
• Having income from capital gains as part of total income.
• Possessing Foreign Assets/ Foreign Income.
• Having agricultural Income more than Rs.5,000.
• In cases where the income of another person is clubbed in the total income under any of the above categories.

ITR-2 is not to be used in case of persons having Income from Business or Profession.

ITR-3

ITR-3 is to be filed by Individuals and HUF having income from business or profession. This form of ITR is also applicable to persons having income from business as a partner in the firm.

ITR-4 or SUGAM

The Income Tax Return ITR-4 is applicable to Resident Individuals, HUF and General Partnership Firms whose income include any or more of the following:

• Business income which have been opted for presumptive basis of taxation under section 44AD or 44AE.
• Professional Income which is opted for presumptive basis of taxation under section 44ADA.
• Income from salary or pension not exceeding Rs.50 Lacs.
• Income from one house property not exceeding Rs.50 Lacs.
• Income from Other Sources not exceeding Rs.50 Lacs.

However, ITR-4 is not applicable in the following cases.

• The total income exceeds Rs.50 Lacs.
• The total income includes income from more than one house property.
• If there is any brought forward loss or loss to be carried forward under any head of income.
• If the person owns any foreign asset or has foreign income.
• If you have signing authority in any account located outside India.
• In case of director(s) of a company.
• In case of shareholder(s) of an unlisted company at anytime during the financial year.
• In case of Non-Residents or Residents but Not Ordinarily Residents.
• In case where the clubbing provisions are attracted.

ITR-5

ITR-5 is applicable in case of Partnership Firms, Limited Liability Partnerships, Association of Persons, Body Of Individuals, Artificial Juridical Person, Business trust and investment fund.

ITR-6

ITR-6 is applicable for all the companies except in case of companies engaged in charitable or religious activities (companies claiming exemption under section 11).

ITR-7

ITR-7 is applicable to persons who are required to furnish returns under the following sections.

• 139(4A)

Required to be filed by every person engaged in charitable or religious activities.

• 139(4B)

Required to be filed by political parties whose total income exceeds the prescribed limits.

• 139(4C)

Required to be filed by entities engaged in 

• Scientific Research
• News Agency
• Association or institution referred to in section 10(23A) or 10(23B)
• Fund or institution or university or other educational institution or any hospital or other medical institution.

• 139(4D)

Required to be filed by university, college or other institution which is not required to furnish return of income or loss under any other provision of this section.

• 139(4E)

Required to be filed by any business trust which is not required to furnish return of income or loss under any other provisions of this section.

• 139(4F)

Required to be filed by any investment fund referred to in section 115UB.

That’s a brief description on various types of ITRs applicable. In case of expert advice with respect to the various ITRs, you may reach us on +91 90740 42503 or send your queries to enquiry@parpella.com and our executives shall assist you in filing your income tax return. Thank you for spending your valuable time to go through this blog.. Contact your Business and Company Registration Consultant in Kerala today.