Income Tax return filing: Who can file tax return using ITR Form-2?

The Income Tax Department has categorised taxpayers on the basis of income, source of income and many other factors to ensure easy compliance. While taxpayers falling in all these categories have to file income tax return, they need to do it through different forms.

As per the Central Board of Direct taxes, Forms ITR 1, ITR 2, ITR 3, and ITR 4 are applicable to individuals. Source - Pixabay.

The Income Tax Department has categorised taxpayers on the basis of income, source of income and many other factors to ensure easy compliance. While taxpayers falling in all these categories have to file income tax return, they need to do it through different forms. There are seven forms that need to be filled by the taxpayers depending upon the category they fall in. As per the Central Board of Direct taxes, Forms ITR 1, ITR 2, ITR 3, and ITR 4 are applicable to individuals. Meanwhile, ITR 5, ITR 6 and ITR 7 are applicable to firms and companies.

The CBDT had notified the ITR forms for the Assessment Year(AY) 2019-20 on April 4, 2019. Only ITR 1 and ITR 4 are live as of now. But, soon other forms will be made available to download as well. It is important for taxpayers to know the importance of each form. For instance, the ITR-2 Form is for individuals and HUFs not carrying any profession or business.

Heena Arora, Finance & Marketing Head of All India ITR explained that if a taxpayer does not make any income under the head 'profits and gains' from business and profession, then it’s compulsory for him to file ITR Form-2. She told Zee Business Online that an individual with income from any of the following sources during the assessment year 2019-20, is eligible to file ITR Form-2:

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- You are a salaried individual or a pensioner.

- Income from foreign assets.

- Income from capital gains.

- Agricultural income exceeding Rs 5 lakh is now to be reported distinctly along with extra details such as name of the district with pin code, measurement of land & etc.

- Income from other sources such as winnings from lottery or other legal gambling, etc.

- If the residential status of the individual/HUF is either Resident Non-Ordinarily Resident (RNOR) or Non-Resident.

How to fill Form 2?

- If any schedule is not applicable to you, strike it out and write —NA— across it.

- If there is any item not applicable to you, write NA against it.

- Write 'Nil' whereever needed.

- Remember to put '-' before negative figures.

The taxpayers should know that all figures have to be rounded off to the nearest one rupee except figures for total income/loss and tax payable. The ITR-2 Form can also not be used if you are claiming double taxation relief under Section 90/90A/91.

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