The Income Tax Return (ITR) filing season for Assessment Year (AY) 2026-27 has begun. One of the most common mistakes made by taxpayers is selecting the wrong ITR form. Filing the incorrect return form can result in the return being treated as defective, leading to notices from the Income Tax Department and unnecessary compliance hassles.
To help taxpayers avoid such issues, this comprehensive guide explains who should use each ITR form for AY 2026-27, along with the latest changes and revised due dates applicable for the current year.
Important Changes for AY 2026-27
Before selecting the correct ITR form, taxpayers should note the following important changes:
1. Reporting of Two House Properties in ITR-1 and ITR-4
A significant relief has been provided to small taxpayers. Individuals eligible to file ITR-1 (Sahaj) or ITR-4 (Sugam) can now report income from up to two house properties, subject to other eligibility conditions.
2. Revised Due Dates for Filing Income Tax Returns
The due dates for AY 2026-27 are as follows:
| Category of Taxpayer | Due Date |
|---|---|
| Individuals/HUFs not liable to audit and not having Business or Professional Income | 31 July 2026 |
| Taxpayers having Business or Professional Income but not liable to audit | 31 August 2026 |
| Taxpayers liable to tax audit | 31 October 2026 |
Taxpayers should ensure timely filing to avoid interest, late fees, and loss of certain benefits.
ITR-1 (SAHAJ)
Who Can File ITR-1?
ITR-1 can be filed by a Resident Individual having:
- Salary or pension income.
- Income from up to two house properties.
- Income from other sources such as bank interest, FD interest, family pension, etc.
- Agricultural income up to ₹5,000.
- Total income up to ₹50 lakh.
- Income from LTCG u/s 112A upto 125000
Who Cannot File ITR-1?
A taxpayer cannot use ITR-1 if he/she:
- Has total income exceeding ₹50 lakh.
- Is a Director in a company.
- Holds unlisted equity shares.
- Has capital gains income.
- Has business or professional income.
- Has foreign assets or foreign income.
- Is a non-resident or resident but not ordinarily resident (RNOR).
Suitable For
- Salaried employees.
- Pensioners.
- Individuals earning interest income.
How to File ITR-1
ITR-2
Who Can File ITR-2?
ITR-2 is applicable to Individuals and HUFs who do not have business or professional income but have:
- Salary or pension income.
- Income from house property.
- Capital gains from shares, mutual funds, property, etc.
- Foreign assets or foreign income.
- Income exceeding ₹50 lakh.
- Directorship in a company.
- Investment in unlisted shares.
Suitable For
- Salaried taxpayers with capital gains.
- Individuals selling property or shares.
- NRIs and persons having foreign assets.
How to File ITR-2
ITR-3
Who Can File ITR-3?
ITR-3 is meant for Individuals and HUFs having income from:
- Proprietorship business.
- Professional practice.
- Freelancing activities.
- Commission or brokerage.
- Futures and options (F&O) trading.
- Intraday share trading.
- Business along with salary, capital gains, house property, etc.
Suitable For
- Chartered Accountants.
- Doctors.
- Advocates.
- Consultants.
- Traders and freelancers.
- Proprietors.
ITR-4 (SUGAM)
Who Can File ITR-4?
ITR-4 is meant for resident individuals, HUFs and firms (other than LLPs) opting for presumptive taxation under:
- Section 44AD (Business)
- Section 44ADA (Profession)
- Section 44AE (Goods Carriages)
Conditions:
- Total income up to ₹50 lakh.
- Presumptive income declared under eligible provisions.
- Income from up to two house properties.
- Interest income and other eligible sources.
- Income from LTCG u/s 112A upto 125000
Who Cannot File ITR-4?
- Persons having foreign assets.
- Directors in companies.
- LLPs.
Suitable For
- Small businesses.
- Tax consultants.
- Professionals opting for Section 44ADA.
- Retail traders.
How to File ITR-4
ITR-5
Who Can File ITR-5?
Applicable to:
- Partnership Firms.
- LLPs.
- Association of Persons (AOPs).
- Body of Individuals (BOIs).
- Artificial Juridical Persons.
Not applicable to individuals.
ITR-6
Who Can File ITR-6?
Applicable to companies other than those claiming exemption under Section 11.
Generally used by:
- Private Limited Companies.
- Public Limited Companies.
ITR-7
Who Can File ITR-7?
Applicable to entities required to furnish returns under special provisions, including:
- Charitable Trusts.
- Religious Trusts.
- Political Parties.
- Educational Institutions.
- Research Associations.
Consequences of Filing Wrong ITR Form
Selecting an incorrect return form may lead to:
- Defective return notices under section 139(9).
- Delay in processing of return.
- Delay in refund.
- Additional compliance burden.
- Need for revised return filing.
Therefore, taxpayers should carefully verify their income sources before selecting the return form.
Choosing the correct ITR form is the first and most important step in filing your Income Tax Return. AY 2026-27 brings important changes, particularly the ability to report up to two house properties in eligible cases and revised due dates for different categories of taxpayers. Before filing your return, evaluate all sources of income including salary, house property, capital gains, business income, professional income, foreign assets, and presumptive income to ensure the correct ITR form is selected.
A properly filed return not only ensures compliance with tax laws but also helps in faster processing and timely refunds.
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