🧾 ITR-1 to ITR-7 Filing: Every Taxpayer & Professionals Must know about Each ITR Forms

By 1FinSolutions | GST Experts for Business Owners, Consultants & Accountants- Dated: 08 July, 2025 

Income Tax Return (ITR) filing isn't just about choosing the correct form — it’s about understanding the right eligibility, hidden clauses, latest changes under Finance Act 2025, and avoiding risk-based scrutiny from the Income Tax Department.

This blog reveals little-known facts, clarifies who should file which ITR, when to file, and gives insight into amended compliance rules for Assessment Year 2025–26 (FY 2024–25).

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📅 Filing Due Dates for AY 2025–26 (FY 2024–25)

Type of Taxpayer	Due Date (AY 2025–26)
Individual / HUF (Non-audit)	15th September 2025
Businesses requiring audit	31st October 2025
Companies or Tax Audit cases	31st October 2025
Trusts requiring audit (Form 10B/BB)	30th September 2025
Revised/Belated Return	31st December 2025

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📌 Quick Table: Who Should File Which ITR?

ITR Form	Who Should File?	Notable Disqualification
ITR-1	Salaried individuals with income ≤ ₹50L	Crypto, multiple properties, foreign assets
ITR-2	Capital gains, foreign income, more than 1 house property	Business/professional income
ITR-3	Business or professional income (including trading)	N/A
ITR-4	Presumptive taxation u/s 44AD, 44ADA	Capital gains, crypto, turnover > ₹3 Cr
ITR-5	Firms, LLPs, AOPs, BOIs (not ITR-7 cases)	Companies, Trusts
ITR-6	Companies (except exempt under Sec 11)	Trusts, political parties
ITR-7	Trusts, NGOs, political parties, institutions under Sec 11/10(23C)	Individuals, firms, companies

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🕵️‍♂️ Unknown & Knowledgeable Facts – Form-Wise Breakdown (As per Finance Act 2025)

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🧾 ITR-1 (SAHAJ)

✅ Unknown Facts:

• Crypto/Gaming/Foreign income disqualifies use.

• Dividend income must match AIS — even ₹10 mismatch can raise CPC notice.

• Leave encashment exemption raised to ₹25L.

• Two house properties? Even if second is vacant, ITR-1 not allowed.

• Exempt income > ₹5,000? File ITR-2 instead.

✅ Who Should File:

• Resident individuals with salary, one house property, interest income.

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🧾 ITR-2

✅ Unknown Facts:

• Mandatory disclosure of foreign bank accounts, even if dormant.

• Capital gain reporting requires broker name, ISIN, purchase/sale date.

• Deemed resident rule for Indian citizens staying >120 days in India with ₹15L+ foreign income.

• Crypto declared as capital asset? Use ITR-2.

✅ Who Should File:

• Individuals/HUFs with capital gains, multiple properties, foreign assets.

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🧾 ITR-3

✅ Unknown Facts:

• All traders (intraday, F&O) must use ITR-3.

• Mismatch between AIS and business turnover triggers audit notice.

• Professionals with gross receipts > ₹75L must switch from ITR-4 to ITR-3.

• Advance Tax required even for professionals under 44ADA beyond ₹10K tax.

✅ Who Should File:

• Individuals/HUFs earning from business, freelancing, trading, consultancy.

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🧾 ITR-4 (SUGAM)

✅ Unknown Facts:

• Digital receipts must be >95% to avail ₹3 Cr limit (44AD) or ₹75L (44ADA).

• Even one capital gain transaction makes ITR-4 invalid.

• Crypto, foreign income, lottery = not eligible.

• Cash expense >5%? Treated as high-risk.

✅ Who Should File:

• Small businesses or professionals under presumptive income scheme.

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🧾 ITR-5

✅ Unknown Facts:

• DSC is mandatory for all LLPs/Firms.

• Mismatch in partner remuneration (ITR-3 & ITR-5) leads to notice.

• UBO (Ultimate Beneficial Owner) details needed for foreign-linked LLPs.

• Filing audit reports before ITR is now strictly enforced.

✅ Who Should File:

• Firms, LLPs, AOPs, BOIs not claiming exemption under Section 11.

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🧾 ITR-6

✅ Unknown Facts:

• CSR expenses not allowed as deduction under Section 37(1).

• GST turnover to be matched with ITR turnover — mismatch leads to red flag.

• Aggressive tax positions must be declared under new Schedule GA.

• Schedule 80G donation disclosures required in detail.

✅ Who Should File:

• All companies not claiming Sec 11 exemption (i.e., not trusts or NGOs).

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🧾 ITR-7

✅ Unknown Facts:

• Form 10B or 10BB must be uploaded before ITR filing – else return invalid.

• Even 1-day delay = exemption under Sec 11/10(23C) is lost.

• Corpus donations must be clearly segregated.

• Political parties must disclose donor PAN > ₹20K.

✅ Who Should File:

• Trusts, NGOs, Political parties, Research Institutions under 10(23C) or Sec 11.

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📌 Other General Finance Act 2025 Amendments You Must Know:

Rule	Description
Leave Encashment Exemption	Raised to ₹25 lakh (earlier ₹3 lakh) for private sector
Deemed Residency Definition Tightened	120+ days in India with foreign income > ₹15L = Resident
Crypto Income Compliance	Covered under 115BBH, can’t use ITR-1/4
AIS/TIS Matching Now Mandatory	All ITRs are cross-verified via AIS system
E-verification timeline	Must e-verify within 30 days of filing or it’s invalid

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🔍 Why This Matters?

Even small errors like:

• Choosing the wrong ITR,

• Missing audit reports,

• Ignoring AIS mismatch,

• Late filing by 1 day
  can result in:

• Penalty u/s 234F,

• Notice u/s 139(9),

• Loss of exemptions under Section 11, 10(23C), or

• Scrutiny under the risk-based assessment model.

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📢 Final Advice from 1FinSolutions

✅ Don’t assume your last year’s ITR form will work again.
✅ Always reconcile Form 26AS + AIS + TIS with actual income.
✅ Get expert advice if:

• You’ve traded in crypto, shares or F&O

• You run a freelance or consultancy business

• You receive foreign income or have overseas assets

• You're filing for trusts, LLPs or firms

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