Which ITR Form Should You File? ITR-1 to ITR-4 Explained Simply

The income tax department provides different return forms for different types of taxpayers. Filing the wrong one can get your return treated as defective, so it is worth taking a minute to identify the right form before you start.

ITR-1 (Sahaj)

The simplest form, meant for resident salaried individuals with:

• Income from salary or pension
• Income from one house property
• Income from other sources (interest, etc.)
• Total income within the prescribed limit

You cannot use ITR-1 if you have capital gains, more than one house property, business income, or are a company director or NRI.

ITR-2

For individuals and HUFs without business or professional income but who have situations ITR-1 does not cover, such as:

• Capital gains (from shares, mutual funds, or property)
• More than one house property
• Foreign income or foreign assets
• Being a company director, or an NRI

ITR-3

For individuals and HUFs who have income from a business or profession and maintain regular books of account — for example, a proprietor, a practising professional, or someone with income from a partnership firm plus other heads of income.

ITR-4 (Sugam)

For taxpayers opting for the presumptive taxation scheme under Sections 44AD, 44ADA, or 44AE — typically small businesses and professionals who declare income at a prescribed rate rather than maintaining detailed books. There are eligibility limits on turnover and the type of income.

Quick guide

• Only salary, one house, interest → ITR-1
• Salary plus capital gains or multiple properties → ITR-2
• Business or professional income with books → ITR-3
• Small business or professional under presumptive scheme → ITR-4

Not sure which applies to you?

The lines blur when you have multiple income sources — say a salary plus freelance work plus some capital gains. Picking the correct form and reporting each head correctly is exactly the kind of thing we handle day to day. Get in touch and we will make sure your return is filed on the right form, the right way.