New ITR Forms Under the Income-tax Act, 2025 — ITR-1 to ITR-7 Comparison
Quick Answer
Under the Income-tax Act, 2025, seven ITR forms continue — ITR-1 (Sahaj), ITR-2, ITR-3, ITR-4 (Sugam), ITR-5, ITR-6 and ITR-7. Naming is preserved, but schedules have been rebuilt around the single “tax year” concept, new VDA disclosures, expanded foreign-asset reporting and regime-selection fields. The form you file depends on your legal form (individual/HUF/firm/LLP/company/trust), income composition (salary, business, capital gains, other sources), income level, and residency. For tax year 2026-27, these are the first returns filed under the new Act.
Last Updated: 15 April 2026 | Applicable From: Tax Year 2026-27 (1 April 2026 onwards) | Reference: Income-tax Act, 2025 (30 of 2025), as amended by Finance Act, 2026
With the commencement of the Income-tax Act, 2025 (30 of 2025) on 1 April 2026 (following Presidential assent on 21 August 2025), the return-of-income framework has been rewritten in simpler language around the unified concept of the tax year. The seven familiar ITR forms — ITR-1 Sahaj, ITR-2, ITR-3, ITR-4 Sugam, ITR-5, ITR-6 and ITR-7 — remain in use, but the schedules have been rebuilt to reflect the new Act’s design choices: a default new tax regime, expanded disclosure of virtual digital assets and foreign holdings, streamlined transfer-pricing linkage, and a dedicated transitional schedule that carries forward losses and depreciation determined under the 1961 Act. This guide compares all seven forms side-by-side — who files which, what income each one captures, how the schedules differ, and what new disclosures taxpayers must make for tax year 2026-27. It is essential reading for anyone filing their first return under the new Act.
Definition — ITR (Income Tax Return): An Income Tax Return is a statement in a prescribed form, furnished to the income tax authorities, setting forth a taxpayer’s total income for a tax year, the tax payable thereon, the tax already paid (through TDS, TCS, advance tax and self-assessment tax), and the balance tax payable or refund due. Under the Income-tax Act, 2025, the return must be filed in the form prescribed by the CBDT under the Income-tax Rules, and must be verified electronically within 30 days of submission.
Form choice follows a three-step test. Step 1 — legal form: individual or HUF? go to steps 2 and 3. Partnership firm / LLP / AOP / BOI? use ITR-5. Company? use ITR-6. Trust / political party / exempt entity? use ITR-7. Step 2 — business income: if you have any business or professional income, you are restricted to ITR-3 (non-presumptive) or ITR-4 (presumptive, subject to the ₹50 lakh income ceiling and residency requirement). Step 3 — income profile (no business): for resident individuals with simple income up to ₹50 lakh, use ITR-1 Sahaj. If you have capital gains, multiple properties, foreign income, foreign assets, or income above ₹50 lakh, use ITR-2. If in doubt, file the broader form — the ITR-2 > ITR-1 or ITR-3 > ITR-4 direction is always safe.
Table of Contents
- Overview of the Seven ITR Forms
- ITR-1 (Sahaj) — Salaried Individuals
- ITR-2 — Individuals and HUFs Without Business Income
- ITR-3 — Individuals and HUFs With Business Income
- ITR-4 (Sugam) — Presumptive Taxation
- ITR-5 — Firms, LLPs, AOPs, BOIs
- ITR-6 — Companies
- ITR-7 — Trusts and Exempt Entities
- New Disclosures Under the 2025 Act
- Pre-Fill, AIS and Utility Options
- Form-Selector Matrix
- Expert Insight
- Key Takeaways
- Frequently Asked Questions
1. Overview of the Seven ITR Forms
The 2025 Act preserves the seven-form architecture for tax year 2026-27. Each form serves a defined category of taxpayer. The table below summarises the cohort.
| Form | Primary User | Ceiling / Restriction | Verification Default |
|---|---|---|---|
| ITR-1 Sahaj | Resident individuals (ordinarily resident) | Income up to ₹50 lakh; simple income profile | Aadhaar OTP |
| ITR-2 | Individuals and HUFs without business income | No ceiling; no business income | Aadhaar OTP / EVC |
| ITR-3 | Individuals and HUFs with business/professional income | No ceiling; full P&L and balance sheet | DSC (audit) / EVC |
| ITR-4 Sugam | Resident individuals/HUFs/firms opting for presumptive taxation | Income up to ₹50 lakh; resident only | Aadhaar OTP / EVC |
| ITR-5 | Firms, LLPs, AOPs, BOIs, AJPs, trusts (non-charitable), investment funds | No ceiling | DSC (audit) / EVC |
| ITR-6 | Companies (other than charitable entities) | No ceiling | DSC (mandatory) |
| ITR-7 | Trusts, political parties, exempt entities | Registration/approval specific | DSC (audit) / EVC |
2. ITR-1 (Sahaj) — Salaried Individuals
ITR-1 Sahaj is the shortest ITR — two pages plus schedules — designed to let ordinary salaried taxpayers file in under 15 minutes. Under the 2025 Act, it has been updated for the tax-year concept and the new-regime default.
Who can file ITR-1
- Resident individual (ordinarily resident — not non-resident or resident but not ordinarily resident)
- Total income up to ₹50 lakh
- Income restricted to: salary or pension; one house property; family pension; agricultural income up to ₹5,000; interest on savings, fixed deposits, post-office deposits and bonds; LTCG on listed equity and equity-oriented mutual funds up to the ₹1,25,000 exemption threshold
Who cannot file ITR-1
- HUFs (must use ITR-2/3/4)
- Non-residents and RNORs
- Taxpayers with business or professional income
- Taxpayers with more than one house property
- Taxpayers with capital gains above the ₹1,25,000 LTCG exemption threshold, or any STCG, or gains on unlisted securities, land, building or debt mutual funds
- Taxpayers with foreign assets, foreign income or foreign signing authority
- Directors in companies or holders of unlisted equity shares
- Persons with agricultural income above ₹5,000
- Persons claiming DTAA relief
Key schedules
Salary details, house property details, other sources, tax-payment details, bank account details (for refund credit) and regime-selection field (new default / old opt-out). Under the 2025 Act, the LTCG declaration for listed equity has been carved into a dedicated row with pre-fill from depository data.
3. ITR-2 — Individuals and HUFs Without Business Income
ITR-2 is the workhorse of high-net-worth individual filings. It accepts every income head except business/professional income. For tax year 2026-27, it is the correct form for most investors, salaried executives with capital gains, HUFs without a business, and directors who do not otherwise have consulting income.
Who files ITR-2
- Individuals or HUFs
- No income from business or profession
- Any of the following: multiple house properties, capital gains (listed or unlisted), foreign assets, foreign income, income above ₹50 lakh, directorship in a company, unlisted equity holdings, RNOR or non-resident status, agricultural income above ₹5,000, claim for DTAA relief
Key schedules
- Schedule S — Salary (with Form 16 pre-fill)
- Schedule HP — House property (for each property separately)
- Schedule CG — Capital gains (listed equity, unlisted, land/building, gold, debt MF)
- Schedule OS — Other sources (including dividend, interest, lottery)
- Schedule VDA — Virtual Digital Asset transfers (new under the 2025 Act)
- Schedule FA — Foreign assets, beneficial ownership, signing authority
- Schedule FSI — Foreign source income
- Schedule TR — Tax relief (DTAA claim)
- Schedule 80C/80D/etc. — Deductions under old regime only
- Schedule Regime — New vs old regime selection
- Schedule TPSA — Transitional brought-forward losses and depreciation from 1961 Act
4. ITR-3 — Individuals and HUFs With Business Income
ITR-3 is the most detailed individual-level return. It includes full Profit & Loss Account, Balance Sheet, tax-audit particulars where applicable, partner-level reporting for firm partners, speculative business schedules and F&O disclosure.
Who files ITR-3
- Individuals or HUFs with any business or professional income (not opting for presumptive)
- Partners in a partnership firm drawing remuneration, interest, salary or commission (post Sec 194T equivalent, these are now subject to TDS at 10%)
- F&O traders, intraday equity traders (speculative business)
- Proprietary consultancies, freelance professionals not opting for 44ADA equivalent
- Crypto/VDA traders running it as a business
Key distinguishing schedules
- Schedule BP — Business and profession (full P&L and balance sheet)
- Schedule DPM/DOA — Depreciation on plant and machinery, other assets
- Schedule IF — Partner information (for partners in firms)
- Schedule ICDS — Income Computation and Disclosure Standards
- Schedule Audit — Tax-audit report particulars (where applicable)
- All schedules from ITR-2 also apply (CG, HP, S, VDA, FA, FSI, TR, TPSA)
5. ITR-4 (Sugam) — Presumptive Taxation
ITR-4 Sugam is for small taxpayers who use presumptive taxation to avoid bookkeeping. Under the 2025 Act, the presumptive schemes continue with the thresholds rationalised by Finance Act, 2026.
Who files ITR-4
- Resident individuals, HUFs and firms (excluding LLPs)
- Opting for presumptive taxation under Sec 44AD equivalent (turnover up to ₹3 crore; 8% / 6% for digital receipts)
- Opting for presumptive taxation under Sec 44ADA equivalent (gross receipts up to ₹75 lakh for specified professions; 50% presumptive)
- Opting for presumptive taxation under Sec 44AE equivalent (goods carriage business)
- Total income up to ₹50 lakh
For deeper detail on presumptive taxation thresholds and cash-receipt limits, see our guide on presumptive taxation under Sec 44AD/44ADA.
6. ITR-5 — Firms, LLPs, AOPs, BOIs
ITR-5 covers entities that are taxed as distinct legal persons but are not companies — firms, LLPs, AOPs, BOIs, business trusts, investment funds, estates of deceased persons and artificial juridical persons. Under the 2025 Act, the form has been expanded to capture the new Sec 194T-equivalent TDS on partner payments.
Key schedules
- Full P&L and balance sheet
- Partner-level schedule — capital contribution, profit share, remuneration, interest, commission, Sec 194T TDS
- AMT schedule (at 18.5% for non-corporate claimants of specified deductions)
- Transfer-pricing linkage (Form 3CEB)
- VDA schedule, foreign asset disclosure
- Regime selection (for individual partners — not at firm level)
7. ITR-6 — Companies
ITR-6 is the corporate return, filed by every company other than those claiming exemption as charitable entities. Paper filing is not permitted — DSC is mandatory.
Key areas
- Corporate tax computation — 30% default, 25% if turnover ≤ ₹400 crore in the reference year, 22% concessional regime (Sec 115BAA equivalent), 15% for new manufacturing companies (Sec 115BAB equivalent)
- MAT computation at 15% of book profits (retained under the 2025 Act)
- Transfer pricing — international and specified domestic transactions (Form 3CEB linkage)
- Section 10AA (SEZ) transitional claim where applicable
- Startup tax holiday claim (Sec 80-IAC equivalent)
- CSR expenditure disclosure
- Foreign tax credit claims
- Brought-forward losses (1961 Act transitional)
For detailed corporate-tax planning, see our guide on corporate tax rates and MAT for 2026.
8. ITR-7 — Trusts and Exempt Entities
ITR-7 is filed by charitable and religious trusts (Sec 11/12/12A/12AB equivalent), political parties, research associations, universities, hospitals, news agencies and scientific research bodies. The form captures registration/approval details, accumulation, application of income, anonymous donations, corpus additions and audit certification in Form 10B/10BB equivalent.
Compliance watch
ITR-7 is the most audit-prone return in the portfolio. Trusts must apply at least 85% of income for charitable purposes; shortfalls require an accumulation resolution and investment in permitted modes. Deviation triggers full taxation at maximum marginal rate.
9. New Disclosures Under the 2025 Act
The 2025-Act versions of the ITR forms introduce four notable disclosure upgrades compared to the forms used for AY 2025-26 and earlier under the 1961 Act.
a) Schedule VDA — Virtual Digital Assets
Every transfer of cryptocurrency, NFT or notified digital asset must be reported line-by-line: date of transfer, VDA name/description, cost of acquisition, consideration received, TDS deducted by the counterparty under Sec 194S equivalent, and resulting gain. Tax is flat 30% (plus surcharge and cess), no deductions except cost, no set-off of losses against any other income, and no carry-forward of losses. See our companion on cryptocurrency and VDA taxation.
b) Schedule FA — Foreign Assets (Expanded)
Foreign bank accounts, custodial accounts, equity/debt interests in foreign entities, trusts (as beneficiary or settlor), real estate, and signing authority must be disclosed. The schedule is now aligned with FATCA/CRS data shared with India — mismatches are flagged automatically in the AIS.
c) Schedule Regime — New vs Old Regime
A dedicated field captures the regime choice, Form 10-IEA equivalent filing date (for business-income taxpayers), and whether the taxpayer has already used their one-lifetime switch.
d) Schedule TPSA — Transitional Losses and Depreciation
Captures brought-forward business losses, speculation losses, capital losses, unabsorbed depreciation, MAT credit and AMT credit determined under the 1961 Act and carried forward into the 2025 Act under Chapter XXIII transitional provisions. See our detailed note on transitional provisions for losses and depreciation.
10. Pre-Fill, AIS and Utility Options
The pre-filled return facility is extended across ITR-1 through ITR-6, pulling data from Form 16, Form 26AS, AIS, SFT, depository records and sub-registrar data. For companies (ITR-6), pre-fill is limited to TDS, TCS, advance tax, self-assessment tax and refund details — P&L/balance-sheet data must be entered manually from audited accounts.
Three utility options
- Online utility — browser-based; best for ITR-1 and ITR-4
- Offline JSON utility — downloadable; best for ITR-2, ITR-3, ITR-5, ITR-6, ITR-7; works offline and uploads the JSON
- Tax-practitioner software — API-integrated; used by CA firms for bulk filing
11. Form-Selector Matrix
| Scenario | Correct Form |
|---|---|
| Resident salaried individual, income ₹18 lakh, one house, bank interest only | ITR-1 Sahaj |
| Salaried individual with LTCG ₹3 lakh on listed shares | ITR-2 |
| Proprietor running a Kirana store, turnover ₹1.5 crore, opts for 44AD equivalent | ITR-4 Sugam |
| F&O trader with loss of ₹4 lakh + salary | ITR-3 |
| HUF with rental income and unlisted equity | ITR-2 |
| LLP with manufacturing business | ITR-5 |
| Private limited company claiming Sec 115BAA equivalent 22% | ITR-6 |
| Section 12A-registered charitable trust | ITR-7 |
| NRI with capital gains on Indian listed equity | ITR-2 |
| Salaried individual running a proprietary consultancy, gross receipts ₹40 lakh, opts for 44ADA equivalent | ITR-4 Sugam |
For detailed due dates and late-filing consequences, see our ITR filing 2026-27 due dates and forms guide. For verification and correction pathways post-filing, see the updated return guide.
Expert Insight
CA V. Viswanathan: I am often asked why the CBDT keeps the “seven-form” architecture instead of consolidating into one smart form. My answer is that the forms mirror legal categories that are structurally different — an individual is taxed differently from a firm, a firm differently from a company, a company differently from a trust. What has changed meaningfully under the 2025 Act is the schedule design. Four changes deserve attention. First, the VDA schedule formalises crypto and NFT reporting; the informal practice of reporting crypto gains under “other sources” is now explicitly wrong — penalty risk for misreporting kicks in. Second, the Schedule FA expansion for foreign assets has teeth because FATCA/CRS data is directly populated into AIS; clients with even a ₹10,000 foreign brokerage balance should disclose. Third, the regime-selection field is now a first-class citizen of the return; I advise business-income clients to treat Form 10-IEA equivalent filings as a permanent structural decision, not an annual toggle. Fourth, the transitional schedule for brought-forward 1961-Act losses requires a one-time reconciliation at the first filing under the 2025 Act — do not postpone this; our experience with the 2018 MAT-credit transitional showed that year-later reconstructions are painful. Pick the right form at the start of the filing season, and 80% of the late-filing stress disappears.
Key Takeaways
- Seven ITR forms are carried forward from the 1961-Act regime under the Income-tax Act, 2025 for tax year 2026-27.
- Form choice depends on legal form (individual/HUF/firm/company/trust), income composition and income level.
- ITR-1 is restricted to resident individuals with income up to ₹50 lakh; HUFs cannot use ITR-1.
- Any business or professional income pushes individuals/HUFs from ITR-1 to ITR-3 (or ITR-4 under presumptive).
- Companies always file ITR-6 with mandatory DSC — no paper filing permitted.
- The 2025-Act schedules include new Schedule VDA (virtual digital assets), expanded Schedule FA (foreign assets), Schedule Regime, and Schedule TPSA for transitional losses.
- Pre-fill covers ITR-1 through ITR-6; offline JSON utility is standard for complex forms.
- Wrong-form filings become defective returns under the 2025 Act; 15-day cure window applies.
- The new tax regime is default; old-regime opt-out needs Form 10-IEA equivalent for business-income taxpayers.
Frequently Asked Questions
How many ITR forms are there under the Income-tax Act, 2025?
Seven — ITR-1, ITR-2, ITR-3, ITR-4, ITR-5, ITR-6 and ITR-7. Naming is carried forward from the 1961-Act regime, but schedules have been rebuilt around the single “tax year” concept, new VDA disclosures, expanded foreign-asset reporting and regime-selection fields.
Who can file ITR-1 (Sahaj) for tax year 2026-27?
ITR-1 is for resident individuals (ordinarily resident) with total income up to ₹50 lakh from salary/pension, one house property, family pension, interest, agricultural income up to ₹5,000, and LTCG on listed equity up to the ₹1,25,000 exemption. It cannot be used by HUFs, non-residents, directors, holders of unlisted equity, or anyone with foreign assets, business income or multiple house properties.
What is the difference between ITR-2 and ITR-3?
ITR-2 is for individuals and HUFs who do not have business or professional income. ITR-3 is for those who do. Once any business income exists, ITR-3 is mandatory regardless of other income heads. A director without consultancy income can still file ITR-2 — directorship is not itself business income.
Who files ITR-4 (Sugam)?
Resident individuals, HUFs and firms (other than LLPs) with total income up to ₹50 lakh where business/profession income is computed on a presumptive basis under Sec 44AD, 44ADA or 44AE equivalents. Non-residents, RNORs, directors, holders of unlisted equity and persons with foreign assets cannot use ITR-4.
Which form do partnership firms, LLPs and AOPs file?
ITR-5. It covers firms (other than those in presumptive), LLPs, AOPs, BOIs, estates of deceased persons, business trusts and investment funds. The form includes partner-level schedules, Sec 194T-equivalent TDS reporting for partner payments, AMT computation, transfer-pricing linkage and 1961-Act transitional loss carry-forward.
What form do companies file?
ITR-6 for every company except those claiming exemption as charitable entities. It captures the corporate tax computation, regime choice (30% default, 25% small company, 22% concessional, 15% new manufacturing), MAT at 15% of book profits, transfer-pricing linkage, CSR disclosure and startup tax-holiday claims. DSC is mandatory — paper filing is not permitted.
Who files ITR-7?
Charitable and religious trusts, political parties, research associations, universities, hospitals, news agencies and other specified exempt entities. ITR-7 captures registration details, Sec 11/12/10(23C)-equivalent exemption claims, 85% application test, accumulation resolutions, anonymous donation tracking and Form 10B/10BB equivalent audit certification.
What new disclosures have been added to ITR forms under the 2025 Act?
Schedule VDA for virtual digital assets with per-transfer reporting; expanded Schedule FA for foreign assets including beneficial ownership and signing authority; Schedule Regime for new-vs-old regime selection including Form 10-IEA equivalent; Schedule TPSA for transitional brought-forward losses, unabsorbed depreciation, MAT and AMT credits from the 1961 Act.
Is the pre-fill facility available for all ITR forms?
Pre-fill covers ITR-1 through ITR-6 for personal particulars, salary, interest, dividend, capital gains on listed equity, TDS/TCS credits and tax payments. ITR-5 and ITR-6 pre-fill is limited to tax-payment data because financial statement data depends on audited accounts. ITR-7 pre-fills registration and tax-payment details.
What are the utility options to prepare an ITR?
Three: (a) the online browser utility on the e-filing portal, best for ITR-1 and ITR-4; (b) the offline JSON utility, best for complex forms like ITR-2/3/5/6/7 — data is entered offline, saved as JSON, then uploaded; (c) tax-practitioner software with direct API integration, used by CA firms for bulk filing.
Can an HUF file ITR-1?
No. ITR-1 is restricted to resident individuals who are ordinarily resident. HUFs file ITR-2 (no business income), ITR-3 (with business income) or ITR-4 (presumptive, subject to ₹50 lakh ceiling). HUFs are taxed as a separate entity with their own PAN.
How do ITR forms capture the new vs old regime choice?
A dedicated regime-selection field at the top of the form captures the choice. Salaried/pension-only taxpayers can toggle every year in the ITR itself. Business-income taxpayers must file Form 10-IEA (equivalent) on or before the due date to opt out, and have only one lifetime switch-back available once they return to the new regime.
Do I need to disclose crypto / VDA holdings in the ITR?
Yes. Schedule VDA in ITR-2, ITR-3, ITR-5 and ITR-6 requires line-by-line disclosure of every VDA transfer — date, cost, consideration, TDS under Sec 194S equivalent. Income is taxed at a flat 30% with no deductions other than cost, no set-off of losses against any other income, and no carry-forward of losses. Non-disclosure triggers misreporting/under-reporting penalty.
What happens if I file the wrong ITR form?
A wrong-form return is treated as defective. The CPC issues a notice giving 15 days to correct the defect. If uncorrected within the extended period, the return is treated as invalid — effectively no return filed — triggering late-filing fee, interest and loss of carry-forward. When in doubt, file the broader form (ITR-2 over ITR-1, ITR-3 over ITR-4).
Are the ITR forms issued by the CBDT or the Income-tax Act itself?
The Act only mandates that returns be filed in the prescribed form. The actual layout, schedules, instructions and utility are prescribed by the CBDT through notifications each year, read with the Income-tax Rules. For tax year 2026-27, CBDT has notified forms aligned with the 2025 Act’s tax-year concept, VDA disclosures and regime mechanics.
Unsure which ITR form applies to your situation for tax year 2026-27? Our team can review your income profile in a 15-minute call — +91 99622 60333 or support@virtualauditor.in. Virtual Auditor — Chennai.