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Income Tax: Difference Between ITR1, ITR2, ITR3, And ITR4; Know Which Is Suitable For You

With the deadline for filing income tax returns for the fiscal year 2023-24 fast approaching, it's crucial for taxpayers to acquaint themselves with the range of income tax return forms available from the Income Tax Department. Below is a detailed overview of ITR1, ITR2, ITR3, and ITR4, including the eligibility criteria for each form.
06:47 PM Apr 03, 2024 IST | Saurav Gupta
income tax  difference between itr1  itr2  itr3  and itr4  know which is suitable for you
Income Tax

As filing income tax returns for the fiscal year 2023-24 nears the deadline, taxpayers must familiarize themselves with the various income tax return forms provided by the Income Tax Department. Here's a comprehensive guide to understanding ITR1, ITR2, ITR3, and ITR4, along with who should use each form.

ITR1 Form

ITR1, also known as the Sahaj form, is suitable for individuals with an annual income of less than Rs 50 lakh. This form is ideal for those earning income from sources such as salary, pension, or other sources, including income from house or property. Even farmers earning Rs 5000 or more can utilize this form.

However, individuals earning income from more than one house property, capital gains, business or unlisted companies, high net worth individuals (HNIs), or company directors are ineligible to use this form.

Also read: April 1: FASTag, NPS, Credit Cards, Debit Cards, And All Key Changes

ITR2 Form

Individuals with an annual income exceeding Rs 50 lakh should opt for ITR2. This form is suitable for those with short-term capital gains, multiple house properties, income exceeding Rs 5000 from farming, income from horse riding betting, lottery, or legal gambling, and investments in companies.

ITR3 Form

ITR3 is designed for individuals or Hindu Undivided Families (HUFs) earning from business or profession, including income covered under ITR2. Those earning from shares of unlisted companies, salary, house property, capital gains, horse racing, or lottery should also use this form.

Also read: Centre Denies Alterations To New Income Tax Regime Effective April 1, Dispels Rumors

ITR4 Form

Individuals and HUFs with an annual income of Rs 50 lakh or more should file ITR4. This form is applicable for income under sections 44AD and 44AE of the Income Tax Act, including salary.

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