Income Tax: What are ITR-2, ITR-3 and who should use them while filing their return?

Mint

23-06-2025

Income Tax: Although taxpayers have a little less than three months before they can file their income tax return (ITR) prior to Sept 15, there are a few tax forms (ITR-2 and ITR-3) whose online utilities have yet not been enabled.
The good news, however, is that income tax (I-T) department has already enabled the excel utilities for ITR-1 (Sahaj) and ITR-4 (Sugam).
But if your income source demands that you file your return using ITR-2 or ITR-3 then you have no choice but to wait for a little longer. Lately, a number of taxpayers have urged the department to release their online utilities. Let us know more about these tax forms.
The income tax return form number 2 (ITR-2) can be filed by individuals or Hindu Undivided Families (HUFs) who are not eligible to file ITR-1 (Sahaj). Taxpayers who do not have income from profits and gains of business or profession and also do not have income from profits and gains of business or profession in the nature of interest, salary, bonus and commission or remuneration, by whatever name called, due to, or received by them from a partnership firm.
It can be filed by those who want the income of another person, such as a spouse or a minor child, to be clubbed with their income if the income to be clubbed falls in any of the above categories.
ITR-2 cannot be filed by any individual or HUF, whose total income for the year includes income from profit and gains from business or profession, and also who has income in the nature of interest, salary, bonus and commission or remuneration, by whatever name called, due to, or received by him from a partnership firm.
The income tax return form number 3 (ITR-3) is meant for individuals and HUFs engaged in business or profession requiring the maintenance of elaborate books of accounts. This category includes working professionals such as doctors, advocates and CAs, whose income is calculated based on actual profits.
Sahaj refers to income tax return form number 1 (ITR-1). The excel utility of this form has already been enabled. This form is meant for resident individuals with a total income of up to ₹ 50 lakh. The sources of income include salary or pension, income from one house property (excluding cases where loss is brought forward), income from other sources (like interest from savings accounts, fixed deposits) and agricultural income (up to ₹ 5,000).
It is noteworthy that tax payer is not eligible if someone is a company director and invested in unlisted equity shares during previous year, have income from business or profession, or resident having foreign assets or foreign income or more capital gains than permitted threshold with LTCG under section 112A more than ₹ 1.25 lakh or having carried forward/ brought forward losses.
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