ITR Forms 1–6 Explained: Which One Should You File?

Introduction

What is ITR?

An Income Tax Return (ITR) is a form used by taxpayers to report their income, claim deductions, and disclose taxes paid during a financial year. The Central Board of Direct Taxes (CBDT) provides different ITR forms tailored to various types of taxpayers. Filing the correct form is essential for compliance and accurate tax reporting.

Under the Income Tax Act, there are seven types of ITR forms—ITR 1 to ITR 7. Let’s break down the meaning and use of ITR Forms 1 to 6.

How to Choose the Right ITR Form?

The correct ITR form for you depends on several key factors:

Source of income (e.g., salary, business, capital gains)
Residential status (resident, non-resident, etc.)
Type of taxpayer (individual, HUF, firm, company)
Foreign income or ownership of foreign assets
Whether you opt for presumptive taxation

Understanding ITR Forms 1 to 6: Detailed Breakdown

If you’re unsure which ITR form suits your financial situation, this guide simplifies the meaning and usage of ITR Forms 1 through 6. Let’s explore each form in detail to help you file your return accurately

ITR-1 (Sahaj): For Salaried Individuals with Simple Income

Who Can File:
Resident individuals with income from:
- Salary or pension
- One house property (no carry-forward loss)
- Other sources (excluding lottery or race winnings)
- Agricultural income up to ₹5,000
Who Cannot File:
- Total income exceeds ₹50 lakh
- Agricultural income over ₹5,000
- Capital gains income
- Business or professional income
- More than one house property
- Director in a company or investor in unlisted shares
- Foreign assets or foreign income
- Non-resident or RNOR
- Deferred ESOP tax or Section 194N deductions
- Losses to be carried forward or set off

ITR-2: For Individuals and HUFs with Capital Gains or Foreign Income

Who Can File:
Individuals and HUFs with income from:

Salary or pension
More than one house property
Capital gains (short/long-term)
Other sources (including lottery or race winnings)
Foreign income or assets
Agricultural income over ₹5,000
Directorship or investments in unlisted shares
RNORs or non-residents
Clubbed income (spouse/child)

Who Cannot File:

Income from business or profession (use ITR-3 or ITR-4 instead)

ITR-3: For Individuals and HUFs with Business or Professional Income

Who Can File:
You should use ITR-3 if you:

Earn from proprietary business or profession (not under presumptive scheme)
Are required to maintain books of accounts or undergo audit
Are a partner in a firm
Hold unlisted equity shares

You may also report:

Salary or pension
House property income
Interest or dividend income

Who Cannot File:

Eligible to file ITR-1, ITR-2, or ITR-4
Have no business or professional income

ITR-4 (Sugam): For Presumptive Income Taxpayers

Who Can File:
Resident individuals, HUFs, or partnership firms (excluding LLPs) with:

Business income under Section 44AD or 44AE
Professional income under Section 44ADA
Salary/pension, one house property, and other sources (total income up to ₹50 lakh)

Who Cannot File:

Total income exceeds ₹50 lakh
More than one house property
Foreign income or assets
Director in a company or investor in unlisted shares
Non-resident or RNOR
Deferred ESOP tax or Section 194N deduction
Losses carried forward or set off

Note: If your business turnover exceeds ₹2 crore, switch to ITR-3

ITR-5: For Firms, LLPs, and AOPs

Applicable To:

Partnership firms
LLPs
AOPs, BOIs, AJPs
Estates of deceased/insolvent individuals
Business trusts and investment funds

ITR-6: For Companies (Not Claiming Section 11 Exemption)

Who Can File:
Companies other than those claiming exemption under Section 11 (charitable/religious use).

Filing is mandatory through digital signature
Applicable for AY 2025–26

ITR-7 – For Charitable Trusts, Political Parties & Certain Institutions

ITR-7 is the designated return form for entities—including companies—that are required to file returns under specific provisions of the Income Tax Act. These provisions cover trusts, institutions, political parties, and other organizations that are exempt from tax under certain conditions.

Entities must file ITR-7 under the following sections:

Section 139(4A): Applicable to individuals or entities receiving income from property held under trust or legal obligation for wholly or partly charitable or religious purposes.
Section 139(4B): Mandatory for political parties whose total income—before exemptions under Section 139A—exceeds the basic exemption limit.
Section 139(4C): Covers specific institutions, including:
- Scientific research associations
- News agencies
- Institutions referred to in Section 10(23A) or 10(23B)
- Educational institutions, hospitals, and medical bodies eligible under relevant tax exemptions
Section 139(4D): Applicable to universities, colleges, or educational institutions not otherwise required to file returns under standard provisions.
Section 139(4E): Business trusts not mandated to file returns under any other section must use ITR-7.
Section 139(4F): Investment funds specified under Section 115UB also fall under this category, even if no other return-filing provision applies.

Note: Filing ITR-7 is mandatory for these entities to maintain compliance and avail of applicable exemptions.

For a detailed guide on how to fill out and file ITR-7 correctly, check out our comprehensive walkthrough.

Quick Recap: Choosing the Right ITR Form

Profile	Use This ITR Form
Salaried with one house	ITR-1
Salaried with capital gains	ITR-2
Freelancer or professional	ITR-3 / ITR-4
Business owner	ITR-3
Small business under presumptive tax	ITR-4
Partnership firm or LLP	ITR-5
Private company (not charitable)	ITR-6
Charitable trust / political party	ITR-7

About the Author

Manisha
Manisha is an experienced legal content writer known for her ability to simplify complex legal topics into practical insights. With a focus on business and tax laws, her work equips entrepreneurs with the clarity and confidence needed to start, manage, and grow their ventures successfully.

June 25, 2025