Which ITR Form Should You File? Find Yours in 2 Minutes

For FY 2025-26 (assessment year 2026-27), pick the form by your income. Salary and interest only: ITR-1. Capital gains, three or more houses or foreign assets: ITR-2. Business or F&O trading with regular books: ITR-3. Small business or profession on presumptive tax: ITR-4. Income above Rs 50 lakh rules out ITR-1 and ITR-4.

Which form matches your income?

You do not choose a form by your job title. You choose it by the kinds of income you earned between 1 April 2025 and 31 March 2026. Find your row.

What knocks you out of ITR-1?

ITR-1 is kept short on purpose, so the department restricts who can use it. As per the e-filing portal, you cannot file ITR-1 for AY 2026-27 if any one of these is true:

• Your total income is above Rs 50 lakh.
• You have any short-term capital gain, even Rs 500 from selling a mutual fund within a year.
• Your long-term gain under section 112A is above Rs 1,25,000.
• You are a director in a company, or you held unlisted equity shares at any time in the year.
• You have an asset, a bank account with signing authority, or income outside India.
• You have a loss brought forward from an earlier year, or a loss to carry forward.
• Tax on your ESOPs (employee stock options) has been deferred.
• Tax was deducted under section 194N, which applies to large cash withdrawals.
• Your agricultural income is above Rs 5,000, or you have any business or professional income.

The capital gains allowance has one catch. It covers only long-term gains on listed shares and equity mutual funds, and only when you have no capital loss to carry forward. If one condition fails, move to ITR-2. It asks for more detail, but the tax is the same.

What knocks you out of ITR-4?

ITR-4 is for presumptive taxation, and is open to individuals, Hindu undivided families (HUFs) and firms other than LLPs. That means you declare a fixed share of your receipts as income under section 44AD (business), 44ADA (specified professions) or 44AE (goods carriages), and you do not keep detailed books.

The ITR-1 exclusions apply here almost one for one: income above Rs 50 lakh, short-term capital gains, long-term gains above Rs 1,25,000, directorship, unlisted shares, foreign assets or income, deferred ESOP tax and losses to carry forward. The portal also bars income taxed at special rates, such as lottery winnings. ITR-4 is optional. If you qualify for it, you may still file ITR-3.

You have a salary and you trade F&O

Does a few months of options trading really change your form? Yes. Futures and options trades are treated as business income, not capital gains. Business income cannot go in ITR-1 or ITR-2, so most salaried traders file ITR-3 with a simple profit and loss account for the trading.

Most small traders end the year with a loss. That loss can be carried forward for up to eight years, but only if you file by your due date and in a form that can report it. ITR-4 cannot carry a loss forward. For a non-audit business case the due date for FY 2025-26 was 31 August 2026.

You sell online on presumptive tax

If you sell on Amazon, Flipkart or Meesho, section 44AD lets you declare 6% of sales received through banking channels (8% for cash sales) as income, or a higher figure if you actually earned more. Marketplace payouts reach you by bank transfer, so 6% is the usual floor. The scheme is open up to a turnover of Rs 2 crore, or Rs 3 crore if cash receipts are 5% or less of the total. That is ITR-4.

Two cautions. Commission and brokerage income is not eligible for section 44AD. And from this year, ITR-4 asks presumptive filers for details of investments and bank balances. If your real margin is below 6%, or you want to claim a loss, you need books and ITR-3. For a small seller, that is the point where paying for help makes sense.

ITR-5, ITR-6 and ITR-7 in one line each

• ITR-5: partnership firms, LLPs and other bodies that are not individuals, HUFs or companies.
• ITR-6: companies, other than those claiming exemption under section 11.
• ITR-7: trusts, political parties, institutions and others who file under sections 139(4A) to 139(4D).

Find your form in four checks

1. Open your Annual Information Statement (AIS) on incometax.gov.in. It lists the income reported against your PAN, including share sales you may have forgotten.
2. Ask: any business, freelance or F&O income? If yes, you are in ITR-3 or ITR-4. If no, ITR-1 or ITR-2.
3. Run through the exclusion list above. One "yes" moves you from ITR-1 to ITR-2, or from ITR-4 to ITR-3.
4. Check your total income against Rs 50 lakh.

Worked examples: four people, four forms

• Riya earns a salary of Rs 9,60,000 and savings interest of Rs 8,200, and owns one flat. Nothing on the exclusion list applies. She files ITR-1.
• Arjun earns Rs 18,00,000 in salary. He sold equity funds for a long-term gain of Rs 1,10,000 and a short-term gain of Rs 22,000. The long-term gain alone would fit ITR-1. The Rs 22,000 short-term gain does not. He files ITR-2.
• Farhan sells phone covers on Flipkart and Meesho. His sales were Rs 38,00,000, all received in his bank account. Under section 44AD he declares at least 6%, which is Rs 2,28,000. He files ITR-4.
• Kavita earns Rs 14,00,000 in salary and lost Rs 85,000 in options trading. She files ITR-3 so the loss is on record for future years.

What happens if you pick the wrong form?

The portal blocks some mismatches at the time of filing. Others get through, and the return can then be treated as defective under section 139(9). You get 15 days from receiving it, or the time stated in the notice, to correct the defect, and you can ask for more time.

If you do not respond, the return may be treated as invalid, as if you never filed. That can bring a late fee, interest, and the loss of your carry-forward. If the filing window is still open, you can also correct the form yourself through a revised return. For FY 2025-26 that window runs to 31 March 2027, with a fee after 31 December 2026. Have you not filed at all? Read how to file a belated return before 31 December 2026.

The mistake people usually make

They file the form they filed last year. Then one new thing breaks it: a short-term gain from a fund switch, a few F&O trades, shares in a startup, or a foreign stock bought through an app. The second mistake is choosing ITR-1 because it is short while the AIS shows share sales. Check the AIS first, then pick the form.

Should you do this yourself?

ITR-1 and a simple ITR-4 are well within your reach. ITR-2 with a broker's capital gains statement takes patience, not expertise. Get help for ITR-3, for F&O with losses, and for sellers whose marketplace TDS does not match their books.

Frequently asked questions

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