It is absolutely crucial to filing the appropriate ITR form. In the event of an inaccurate filing, the Income Tax Department will submit a taxpayer with the receipt of a faulty notice and ask him / her to update it within a defined period. The taxpayer will however encounter ITR non-filing penalties and the ITR will be declared void if the defect is not corrected by an individual within the stated period. The four Income Tax Return (ITR) forms that are applicable to an individual are -ITR-1 SAHAJ, ITR-2, ITR-3 and ITR-4.
ITR-1 SAHAJ can be filed by a regular resident person (not HUF) having an income of up to Rs 50 lakh. Overall income for this context includes - salary or pension profit, income from one house property, income from other streams such as bank account interest (except lottery earning and race horse earnings, income is subject to tax under section 115BBDA or income of the sort referred to in 115BBE) and where the income from agricultural source is up to Rs 5,000.
ITR-2 can be submitted by a citizen who is the owner or maintaining directorship of a firm or company.
ITR-3 can be submitted by a person and a HUF with business or professional income, or a person maintaining a joint venture in a company.
ITR-4 is to be filed by an individual/ HUF/ Partnership Company whose overall revenue for the 2018-19 appraisal year covers:
- Business profit where such income has been measured in compliance with the special laws referred to in sections 44AD and 44AE of the Act for computation of business income; or
- Professional earnings where those earnings are determined in compliance with the special provisions alluded to in Sections 44ADA; or
- Salary/ Pension; or
- Income from One House Property (excluding circumstances where loss or impairment to be taken forward under this head); or
- Income from other revenue streams (excluding lottery prizes and race horse revenues)