The deadline for filing income tax returns is approaching. There is a high possibility of making mistakes in filing returns at the last moment. Therefore, it is beneficial to file the return before the deadline.
For this, you will have to collect some documents. These include Form-16, Annual Information Statement (AIS) and Form 26AS. After this, the correct ITR form has to be chosen. Many taxpayers get confused between Form-1 and Form-2. Let us know who cannot use ITR-1. ITR-1 is also called Sahaj.
If your income is more than 50 lakhs then ITR-1 cannot be used
If the total income of a taxpayer is more than Rs 50 lakh in a financial year, then he cannot use ITR-1. Similarly, Resident Non-Ordinarily Resident ( RNOR ) and NRI cannot use this form to file returns. If a person’s income from agriculture is more than Rs 500, then he cannot use ITR-1 to file returns. If there is income from lottery, horse racing etc., then ITR-1 cannot be used to file returns.
Also Read: Gift Tax in India: Do you have to pay tax on gifts received on birthday or marriage? Know these important rules
ITR-1 is not used in case of capital gains
If a person has made capital gains by selling any assets during the relevant financial year, then he cannot use ITR-1. If a person has invested in shares of companies which are not listed in the stock market, then he cannot use ITR-1. If a person has income from business or profession, then he cannot use ITR-1. Even if a person is a director in a company, he cannot use ITR 1. Employees of companies who have received ESOPs also cannot use ITR-1 to file returns. If a person has more than one house, then also he cannot use ITR-1.
Choose the form wisely
It is important to use the correct form to file income tax return. Filing the return using the wrong form will make your return defective. Therefore, it is important to choose the correct form carefully before filing the return. If you are facing any problem in choosing the correct form, you can take the help of a tax expert. This will prevent you from using the wrong form. That is why experts advise to avoid filing the return at the last moment.
