Which ITR form should you file? ITR-1, ITR-2, ITR-3 or ITR-4

The ITR form you choose depends on where your money came from, not on how big your salary is. Pick one you are not eligible for and the department can treat the return as defective, which means an income tax notice and a fix within 15 days.

Which year this covers. The latest forms the Central Board of Direct Taxes (CBDT) has notified are for assessment year 2026-27, which means income earned from April 2025 to March 2026. They were notified on 30 March 2026 under the old 1961 law, because that income still falls under it. Income earned from April 2026 is tax year 2026-27 under the new Income-tax Act, and will be filed in 2027 on forms made under the new rules. The rules below are for the 2025-26 income.

ITR-1 (Sahaj): the short form

For a resident individual, not “not ordinarily resident”, with total income up to 50 lakh rupees, from:

• salary or pension
• up to two house properties (new for this year; earlier forms allowed one)
• other sources, such as interest, family pension and dividends
• agricultural income up to 5,000 rupees
• long-term capital gains on listed shares and equity funds, under section 112A, up to 1.25 lakh rupees

You cannot use ITR-1 if you are a company director, held unlisted equity shares at any time in the year, have any asset or income outside India or signing authority in a foreign account, have any short-term capital gain, have losses to carry forward, or have deferred tax on employee stock options.

ITR-2: capital gains and more

For individuals and Hindu undivided families (HUFs) with no business or professional income who cannot use ITR-1. Common reasons: short-term capital gains, long-term gains above 1.25 lakh rupees, foreign assets or income, a directorship, unlisted shares, more than two house properties, total income above 50 lakh rupees, or being a non-resident.

ITR-3 and ITR-4: if you run a business or profession

ITR-4 (Sugam) is for resident individuals, HUFs and firms other than LLPs whose business or professional income is computed under the presumptive taxation scheme (sections 44AD, 44ADA and 44AE of the 1961 Act). Total income must be up to 50 lakh rupees, and the same exclusions as ITR-1 apply. It is optional.

ITR-3 is for individuals and HUFs with business or professional income who cannot use ITR-4, for example because they keep full accounts or earn above 50 lakh rupees. It can also report salary, house property, capital gains and other income.

An illustration. Asha earns a salary of 14 lakh rupees and sold equity fund units held for two years at a 90,000 rupee gain. That gain is under 1.25 lakh, so ITR-1 works. If she had also sold shares held for eight months at a 20,000 rupee profit, that short-term gain moves her to ITR-2. If she instead had freelance design income taxed under the presumptive scheme, she would look at ITR-4. (Made-up numbers.)

Did you know? Your AIS often decides the form for you. If it shows a share sale, foreign dividend or unlisted share you had forgotten, the simple form may no longer fit. Check AIS and Form 26AS before you choose.

Missed the July deadline?

The due date for most people for 2025-26 income was 31 July 2026. You can still file a belated return until 31 December 2026, with a late fee of 5,000 rupees, or 1,000 rupees if total income is up to 5 lakh rupees. Steps are in how to file your income tax return.

The takeaway. Start with ITR-1 and look for a reason you cannot use it: capital gains beyond the limit, anything foreign, a directorship, unlisted shares, business income, or income above 50 lakh rupees. Each one points you to ITR-2, ITR-3 or ITR-4.

More to read: what to do if you get an income tax notice, Form 16, decoded, old vs new tax regime, and how capital gains are taxed.