Which ITR Form Should You File? AY 2026-27 | CGK & Co Which ITR Form
Should You File?One of the most common questions we get every filing season. The answer depends on who you are, what income you earn, and what conditions apply. Here is a clear guide for AY 2026-27.
Filing in the wrong ITR form is not a technicality — it is a defective return. Getting this right before you file saves a lot of back-and-forth with the department. Here is how to work out which form applies to you.
The starting point is always the same: are you an individual, or something else? From there, the path depends on your income type. Let us walk through it step by step.
The decision tree — step by step
ITR Form Selection — AY 2026-27STARTAre you an Individual?Yes — IndividualBusiness or Profession income?YesEligible for Presumptive?
(44AD / 44ADA / 44AE)YesITR-4SUGAMNoITR-3NoSimple income ≤ ₹50L?
Salary + up to 2 house properties + interest + LTCG u/s 112A ≤ ₹1.25L + Agri ≤ ₹5KYesITR-1SAHAJNoITR-2No — Not IndividualCompany?YesITR-6Except Sec 11NoTrust / संस्था?YesITR-7OthersITR-5Not allowed in ITR-1 or ITR-4If any of these apply, you cannot use the simpler forms:
- Director in a company
- Holding unlisted shares
- Foreign assets or foreign income
- ESOP deferred tax
- TDS deducted under Section 194N
Special Forms
- ITR-V — Acknowledgement form when return is not e-verified. Must be sent to CPC Bengaluru within 30 days of filing.
- ITR-U — Updated return. Can be filed within 48 months. Requires payment of additional tax.
Each form in plain language
Here is what each form is for, who it applies to, and the key conditions that govern eligibility.
ITR-1SAHAJResident individuals with simple income
- Total income up to ₹50 lakh
- Income from salary or pension
- Income from up to one house property
- Interest income and other sources
- Agricultural income up to ₹5,000
- LTCG under Section 112A up to ₹1.25 lakh
- Cannot be used if you are a director, hold unlisted shares, have foreign assets, or had TDS under Section 194N
ITR-2Individuals and HUFs — no business income
- Income exceeding ₹50 lakh, or complex income
- Capital gains from shares, property, mutual funds
- More than one house property
- Foreign assets or foreign income
- Director in a company or holding unlisted shares
- Any individual who does not qualify for ITR-1 but has no business or professional income
ITR-3Individuals and HUFs with business or professional income
- Income from business or profession (not on presumptive basis)
- Partner in a firm
- Any income that cannot be reported in ITR-1, ITR-2, or ITR-4
- Requires full books of account or detailed disclosure
- Tax audit cases where applicable
ITR-4SUGAMIndividuals, HUFs, firms on presumptive taxation
- Income under Section 44AD (business — turnover up to ₹3 Cr with 95% digital receipts, else ₹2 Cr)
- Income under Section 44ADA (specified professionals — receipts up to ₹75L with 95% digital, else ₹50L)
- Income under Section 44AE (transport operators)
- Total income must not exceed ₹50 lakh
- Cannot be used if director, unlisted shares, foreign assets, ESOP deferral, or 194N TDS
ITR-5Firms, LLPs, AOPs, BOIs, and others
- Partnership firms and LLPs
- Association of Persons and Body of Individuals
- Cooperative societies
- Local authorities
- Any entity not required to file in ITR-6 or ITR-7
ITR-6Companies (except those claiming Section 11 exemption)
- All companies registered under the Companies Act
- Not applicable to companies claiming income exemption under Section 11 (charitable or religious purpose)
- Such companies — Section 25 companies, for instance — file ITR-7 instead
- Must be filed electronically with digital signature
ITR-7Trusts, charitable institutions, political parties, and specified entities
- Persons and companies required to file under Sections 139(4A), (4B), (4C), (4D)
- Charitable and religious trusts claiming exemption under Section 11 and 12
- Political parties
- Research associations, universities, medical institutions under Section 10
- Electoral trusts
The exclusions that catch people out
ITR-1 and ITR-4 are the simpler, more popular forms. But a handful of conditions disqualify you from using them — and these are conditions that more people fall into than you might expect.
Condition ITR-1 Allowed? ITR-4 Allowed? Where to File Instead Director in any company No No ITR-2 or ITR-3 Holding unlisted shares No No ITR-2 or ITR-3 Foreign assets or foreign income No No ITR-2 or ITR-3 ESOP where tax is deferred No No ITR-2 or ITR-3 TDS deducted under Section 194N No No ITR-2 or ITR-3 More than one house property No Yes ITR-2 (if no business income) Capital gains from shares or property No (except LTCG u/s 112A ≤ ₹1.25L) No ITR-2 or ITR-3 Total income exceeds ₹50 lakh No No ITR-2 or ITR-3 A word on ITR-U — the updated returnIf you filed in the wrong form or missed declaring some income, the updated return (ITR-U) gives you 48 months from the end of the financial year to correct it. There is additional tax to pay — the percentage increases the longer you wait — but it is far better than a notice from the department. For AY 2026-27, the updated return window runs until March 2031.
A practical note
The form selection question matters more than most people realise. A return filed in the wrong form is treated as a defective return — the department issues a notice under Section 139(9) asking you to refile correctly. This causes delays, sometimes affects refunds, and in business cases can affect the carry-forward of losses.
If you are in any of the exclusion categories — a working professional who also sits on a company board, a trader who holds unlisted shares, or anyone with foreign investments — take a moment before filing to confirm you are in the right form. The difference between ITR-1 and ITR-2 may seem minor; the consequences of getting it wrong are not.
Still not sure?If your income profile has changed this year — new business income, a directorship, a foreign asset, or a capital gains transaction — it is worth checking before you file. An incorrect form cannot simply be revised; it has to be refiled as a fresh return in the correct form, within the time limits for belated returns.
Not certain which form applies to you?
We work through this for clients every filing season. If your income profile has any complexity — business income, capital gains, foreign assets, or a directorship — just write to us before filing.
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