Filing an Income Tax Return is a basic financial responsibility if you earn income during the year. It is the process through which you inform the Income Tax Department about your total income, taxes paid and deductions claimed. Filing on time helps you stay compliant, claim refunds if any and maintain proper financial records.
This guide explains who must file, when to file, which form to choose and what documents you need.
What Is an Income Tax Return (ITR)
An Income Tax Return (ITR) is a form used to report:
- Income from salary, pension, business, profession, house property, capital gains or other sources such as bank interest
- Deductions and exemptions claimed under different sections of the Income Tax Act
- Taxes already paid through TDS or advance tax
- Final tax payable or refund due
The return calculates whether you have paid the correct tax. If excess tax was deducted, you can claim a refund by filing your return.
Who Should File an ITR
You are required to file a return for Financial Year 2024 to 25 if any of the following conditions apply.
- Income above the basic exemption limit
You must file if your total gross income before deductions exceeds the basic exemption limit.
- Under the Old Tax Regime, the basic exemption limit is ₹2,50,000 for individuals below 60 years.
- Under the New Tax Regime, which is the default from FY 2023 to 24 onwards, there is a rebate that makes tax nil up to ₹7,00,000. However, the basic exemption limit before rebate is ₹3,00,000. If your gross total income crosses this, you must file.
- You want to claim a refund
If tax was deducted by your employer or bank and your actual tax liability is lower, you need to file an ITR to get the refund.
- You want to carry forward losses
If you have capital losses or business losses and want to adjust them in future years, filing the return within due date is necessary.
- You have specific income or asset conditions
You must file even if your income is below the exemption limit if:
- You hold assets or bank accounts outside India
- You have a financial interest in any entity outside India
- You are a director in a company
- Tax was deducted under Section 194N, such as in cases of large cash withdrawals
- High-value transactions
Filing is required if you meet certain high-value conditions during the year:
- You spent more than ₹2 lakh on foreign travel for yourself or any other person
- You deposited more than ₹1 crore in one or more current bank accounts
- Your electricity expenditure exceeded ₹1 lakh in the financial year
Choosing the Correct ITR Form
Selecting the right form depends on your type of income and profile.
ITR 1 Sahaj
This form is meant for resident individuals with:
- Total income up to ₹50 lakh
- Income from salary or pension
- Income from one house property
- Income from other sources such as bank interest
- Agricultural income up to ₹5,000
It cannot be used if you have business income, capital gains, more than one house property, foreign assets or if you are a director in a company.
ITR 4 Sugam
This form applies to resident individuals, HUFs and firms other than LLPs who opt for the presumptive taxation scheme under Sections 44AD, 44ADA or 44AE.
Conditions include:
- Total income up to ₹50 lakh
- Business or professional income declared under presumptive scheme
- Can also include salary or pension, one house property and other sources
It cannot be used if:
- Turnover exceeds ₹2 crore even under presumptive scheme
- You have capital gains
- You have foreign assets or are a director in a company
ITR 2
Used by individuals and HUFs who are not eligible for ITR 1 and who do not have income from business or profession.
It is generally used when:
- Total income exceeds ₹50 lakh
- You have capital gains from sale of property, shares or mutual funds
- You have more than one house property
- You have foreign income or foreign assets
ITR 3
For individuals and HUFs who have income from business or profession. This includes partners in firms and those engaged in trading such as futures and options.
ITR 5, 6 and 7
- ITR 5 is for firms, LLPs, AOPs, BOIs and other non-individual entities.
- ITR 6 is for companies registered under the Companies Act, except those claiming exemption under Section 11.
- ITR 7 is for trusts, political parties, charitable institutions, universities and others required to file under specific sections.
Due Date for Filing
The financial year runs from April 1 to March 31. The return is filed in the next year, called the Assessment Year.
For Financial Year 2024 to 25, the Assessment Year is 2025 to 26.
Standard Due Dates
- Individuals including salaried and most ITR 1 and ITR 4 filers must file by July 31, 2025
- Taxpayers whose accounts require audit must file by October 31, 2025
Late Filing and Penalties
If you miss the main due date, you can still file a belated return up to March 31, 2026. However, late filing fees under Section 234F apply:
- If total income is up to ₹5,00,000, late fee is ₹1,000
- If total income exceeds ₹5,00,000, late fee is ₹5,000
Other consequences of late filing
- Refund may be delayed
- Interest at 1 percent per month may be charged on unpaid tax under Section 234A
- Certain losses such as capital losses cannot be carried forward
Key Documents Required for Filing
Proper documents make filing accurate and smooth.
Basic identity documents
- PAN card linked with Aadhaar
- Aadhaar card
Income related documents
- Form 16 issued by employer
- Bank account statements or passbook
- Proof of income from interest, dividends or freelance work
Tax details
- Form 26AS showing TDS details
- Annual Information Statement for transaction records
Investment and deduction proofs
- Receipts for investments under Section 80C such as PPF, ELSS, life insurance premiums
- EPF passbook or contribution slips
- Fixed deposit receipts for tax saving deposits
- Tuition fee receipts for up to two children
Medical and insurance deductions
- Medical bills and prescriptions for deductions under Section 80D or 80DD
Education loan
- Loan repayment certificates for deduction under Section 80E
Documents for Business or Professional Income
If you are self-employed or running a business, keep:
- Profit and loss statement and balance sheet
- GST returns if applicable
- Invoices and receipts for income and expenses
- TDS certificates issued by clients
Maintaining organised records helps avoid mismatches and notices.
Documents for Capital Gains
If you sold property or other assets, keep:
- Sale deed and purchase agreement
- Proof of improvement expenses
- Investment proofs in specified bonds under Section 54EC if claiming exemption
Documents for House Property Income
For rental income or housing loan deductions:
- Rent agreement or rent receipts
- Property tax payment receipts
- Housing loan interest certificate for deduction under Section 24
How to Prepare Before Filing
Before filing, review your Form 26AS and Annual Information Statement to match all income details. Cross-check salary, bank interest and investment income.
You can also use an income tax calculator to estimate your tax liability under both tax regimes before submitting the return.
Final Thoughts
Filing your Income Tax Return on time is important for compliance, refunds and financial credibility. Choose the correct form based on your income type. Keep all required documents ready. Check due dates carefully to avoid penalties and interest.