Filing the wrong form can trigger a defective return notice under §139(9), delay your refund, or—even worse—invalidate the filing altogether. The Central Board of Direct Taxes (CBDT) has already notified all seven forms for AY 2025‑26 and released utilities for ITR‑1, 4, 2 and 3; the e‑filing due date for most taxpayers now stands extended to 15 September 2025.
Quick‑glance comparison
Your choice of structure depends on your business goals, number of founders, scalability, and compliance appetite:
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ITR Form
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Who can use it?
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Core income sources allowed
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Key disqualifications
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ITR‑1 (Sahaj)
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Resident individuals (except “not ordinarily resident”)
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Salary/pension, one house property, other sources; total income ≤
₹50lakh
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Capital gains, business/profession, foreign assets/income, directorship/unlisted shares
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ITR‑2
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Individuals & HUFs without business/profession
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All in ITR‑1 plus capital gains, >1 house property, foreign assets, agri‑income>₹5k
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Business or professional income
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ITR‑3
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Individuals & HUFs with business/profession
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Proprietorship, freelancing, partner’s share/remuneration, presumptive 44AD/ADA/AE (if not opting ITR‑4) | — |
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ITR‑4 (Sugam)
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Residents—individuals, HUFs, firms (non‑LLP) on presumptive scheme
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44AD small biz (turnover
≤ ₹2 cr), 44ADA professionals (income
≤ ₹50 lakh), 44AE transporters
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Non‑resident, capital gains, foreign assets, unlisted shares, income > limits
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ITR‑5
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Firms, LLPs, AOPs, BOIs, estates, investment funds, business trusts
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All income heads as applicable
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If eligible for ITR‑7 (charitable etc.) or ITR‑6 (companies)
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ITR‑6
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Companies not claiming S11 exemption
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Business & other income
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Companies claiming charitable exemption
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ITR‑7
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Trusts, political parties, research/educational institutions filing u/s
139(4A–4D)
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Income eligible for exemption under respective sections
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Entities not covered by 4A–4D
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ITR‑1 (Sahaj) ― your “plain‑vanilla” salary return
Ideal for most salaried taxpayers who do not have capital gains or side businesses. Remember, even ₹100 of intraday share trading ejects you from this form.
Pro tip: Double‑check interest from savings/FDRs; many filers forget to add it and later receive mismatch notices.
ITR‑2 ― when capital gains or multiple properties enter the mix
If you sold equity, received ESOPs, or own two flats, ITR‑2 is your home. No business figures allowed, but partner income from an LLP/firm is perfectly fine.
New for AY 2025‑26: A separate crypto‑asset schedule demands granular breakup of purchase and sale values.
ITR‑3 ― the all‑in‑one for proprietors & professionals
From CA practices to YouTube freelancers, if you carry on a profession or business and are not under presumptive taxation, this is mandatory. Balance sheets and P&Ls are integral sections, so keep your books closed before you start.
ITR‑4 (Sugam) ― streamlined presumptive filing
Choose this if you want to pay tax on a fixed percentage of turnover/receipts rather than keep detailed books. Mind the ceilings:
- Business turnover ≤ ₹2 crore (44AD)
- Professional gross receipts ≤ ₹50 lakh (44ADA)
- Transporters limited to ≤ 10 goods vehicles (44AE)
Even a single foreign share holding knocks you out—switch to ITR‑3 instead.
ITR‑5, 6 & 7 ― entity‑centric returns
- ITR‑5: Partnership firms, LLPs, AOPs, BOIs, estates, investment funds, business trusts.
- ITR‑6: Domestic & foreign companies (other than charitable/§11‑exempt).
- ITR‑7: Charitable trusts, political parties, colleges, research bodies filing under §§ 139(4A)–(4D).
Startup founders often miss that an LLP must file ITR‑5 even if turnover is NIL; penalty for late filing still applies.
Major compliance updates for AY 2025‑26
- Crypto & VDAs: All forms (except ITR‑1/4) include detailed VDA schedules for cost, sale proceeds, and TDS credit.
- Revised due dates: Standard non‑audit due date moved to 15 Sept 2025; audit cases keep 31 Oct 2025 (tax audit) and 30 Nov 2025 (TP report).
- New AIS alignment: Pre‑fill now covers dividend breakup and overseas travel spends—cross‑verify before submission.
- Form 64A/64E trusts: Filing deadline advanced to 15 June 2025.
Five quick FAQs
Q1. I am salaried with ₹60 lakh income and ₹1 lakh LTCG—form?
A: ITR‑2 (income exceeds ₹50 lakh, plus capital gains).
Q2. Small shop owner, turnover ₹35 lakh, wants presumptive 44AD—form?
A: ITR‑4 (turnover ≤ ₹2 cr and opting presumptive).
Q3. Resident doctor earning ₹48 lakh via consultations under 44ADA, also rent from one house.
A: ITR‑4 (within limits, professional presumptive).
Q4. LLP with no turnover this year—must it still file?
A: Yes, ITR‑5 is mandatory irrespective of turnover.
Q5. Company claiming §11 exemption as a charitable institution—form?
A: ITR‑7 (filed under §139(4A)), not ITR‑6.
Action checklist before you hit “File”
- Match AIS/TIS & Form 26AS for TDS/TCS credits.
- Verify bank accounts—at least one must be validated for refunds.
- Digitally sign (DSC) or e‑verify within 30 days; failure voids the filing.
- Save JSON & acknowledgement for at least six years—useful during scrutiny.
Final thoughts
Choosing the correct ITR form isn’t just a clerical step; it’s the foundation of a compliant, stress‑free tax season. When in doubt, err on the side of a more detailed form—the portal won’t penalise you for over‑reporting but can reject an underspecified return.
Need bespoke filing support? Feel free to reach out to G R Prasad & Associates, Kondapur, Hyderabad—we combine a decade of tax expertise with end‑to‑end e‑filing assistance.
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