Who is eligible to file the ITR-1 Form?

The conditions that will make you fill out ITR-1 include the following. ITR-1 is the form of income tax return that any individual can submit, subject to certain conditions. If an individual is not fulfilling any of the below-stated conditions, he cannot submit his income tax return in the form of ITR-1.

• The source of Income must be salary, one house property and other income. The other income includes interest income, dividends, etc. and agricultural income not exceeding Rs.5000.
• The total income earned by an individual should not exceed Rs.50 lakh.
• An individual must be an ordinarily resident Indian.

Who is eligible to file the ITR-2 form?

However, if you have income from sources other than those above-mentioned or if your residential status is different, then you have to file your return using the ITR-2 form.

An individual is eligible to file ITR-2 if he or she satisfies any of the following conditions:

• Earns income from salaries, has one or more house properties or has other sources of income other than those specified above.
• Has the foreign source of income, such as a dividend received from foreign shares etc.
• Director of a company.
• Holding an investment in unlisted equity shares
• Assets hold outside India.
• Their total income is more than fifty lakh rupees.
• Is Hindu Undivided Family (HUF).
• Is a non-resident individual or a resident individual (both ordinarily or not ordinarily).
• If any losses must be carried forward or brought forward under the income category ‘Income from house property’.

ITR-1 Vs. ITR-2: Some Major Differences

If a person has additional sources of income, such as income from a business or profession, they cannot file their tax return using ITR-1 or ITR-2 forms. They must complete a particular ITR form that is specific to their situation.

ITR-2 Form is more complex than ITR-1, which is famously referred to as Sahaj because of the least number of entries to be filled.

In fact, while filing tax returns using ITR-1 on the new income tax portal, most of the information on this form gets pre-filled. So you just need to maybe cross-reference it with your documents and then file your return. The ITR-2 is relatively more complicated than the ITR-1, while the information is pre-filled, there are some questions you have to answer before you can start filling out the form, such as the date of purchase and unit details in the case of shares or mutual funds for calculating capital gains.

Below are Some of the Major Concerns that users have about ITR-1 and ITR-2

What is ITR 1?

The ITR-1 form is known as SAHAJ and is available for those Indian residents whose total income is being made from salary or pension income, income from one house property, income from other sources such as interest, dividends and income from agricultural land not exceeding 5000 rupees.

What is ITR 2?

ITR 2 applies to individuals and Hindu Undivided Families (HUFs) who from the profits and gains of business or profession. This form is for those who have more than one house property, capital gains, foreign income or assets, or agricultural income in excess of Rs.5000.

Is ITR-1 applicable for NRI? Does it mean that non-resident Indians are also allowed to file ITR-1?

There are some constraints to the use of ITR 1, for example. Non-resident Indians cannot file their returns with this form. They have to fill out the ITR 2 form or any of the relevant forms, depending on their sources of income.