What is the ITR-2 Form?
The ITR-2 is a specific tax return form for individuals and Hindu Undivided Families (HUFs) in India. You must use ITR-2 if you have income sources that are not covered by the simpler ITR-1 form, such as capital gains, earnings from more than one house property, or any foreign assets and income.
The key condition is that taxpayers filing ITR-2 do not have income from a business or profession. This form helps you declare all your income, deductions, and tax liabilities to the Income Tax Department of India.
Who is Eligible to File ITR-2?
This form is mandatory for individuals and HUFs who meet any of the following criteria:
- Income from Capital Gains: If you have earned income from selling shares, mutual funds, property, or any other capital asset.
- Income from More than One House Property: If you have rental income from two or more properties.
- Foreign Income or Assets: If you are a resident and hold any foreign assets or have foreign income.
- Company Director or Unlisted Shares: If you are a director in a company or hold unlisted equity shares.
- Agricultural Income: If your agricultural income exceeds ₹5,000.
- Total Income Exceeds ₹50 Lakh: If your total income is more than ₹50 lakh.
- Non-Residents or RNORs: NRIs and RNORs meeting the income criteria.
- Other Sources: Income from lottery winnings, gambling, racehorses, or Virtual Digital Assets (VDAs) like crypto.
Who Cannot File ITR-2?
Individuals or HUFs earning income from business or profession (including freelancing, consulting, or partnership firm income) cannot use ITR-2. They must use ITR-3 or ITR-4.
ITR-2 vs. Other Forms
ITR-1 vs. ITR-2
ITR-1 is for simple income (salary, one house, interest) up to ₹50 lakh. ITR-2 is for more complex income (capital gains, multiple properties, foreign assets) with no upper income limit.
ITR-2 vs. ITR-3
ITR-2 is for individuals without business income. If you have any income from business or profession (even freelancing), you must file ITR-3, even if you also have capital gains or salary.
Documents Required for ITR-2 Filing
- Core Documents: PAN, Aadhaar, Bank account details.
- Income Proofs: Form 16 (Salary), Rental Agreements (House Property), Capital Gains Statements (Shares/Property).
- Deduction Proofs: LIC premiums (80C), Medical Insurance (80D), Donation receipts (80G), Home Loan Interest certs.
- Reconciliation Documents: Form 26AS, Annual Information Statement (AIS), Taxpayer Information Summary (TIS).
- Foreign Assets: Details of foreign bank accounts, assets, and income.
Key Schedules in ITR-2
- Schedule S: Salary and pension details.
- Schedule HP: Income from house property (rent, interest, taxes).
- Schedule CG: Capital gains from sale of assets.
- Schedule OS: Income from other sources (dividends, interest, lottery).
- Schedule FA: Foreign assets and income (Mandatory for residents with foreign assets).
- Schedule VDA: Income from Virtual Digital Assets (Crypto/NFTs).
- Schedule AL: Assets and Liabilities (Mandatory if income > ₹50 lakh).
How to File ITR-2 Online
- Log in: Access the Income Tax e-Filing portal with your PAN.
- Select Form: Choose Assessment Year and select ITR-2.
- Verify Pre-filled Data: Check data from Form 26AS, AIS, and TIS.
- Fill Schedules: Enter details in Schedule S, HP, CG, OS, etc.
- Report Capital Gains: Use Schedule CG for accurate reporting of asset sales.
- Compute Tax: The system calculates liability. Pay any due tax.
- Submit & E-Verify: Submit the return and e-verify via Aadhaar OTP or Net Banking within 30 days.
Due Dates & Penalties
Due Date: The due date for filing ITR-2 for AY 2025-26 is July 31, 2025 (extended to September 15, 2025 for non-audit cases).
Penalties (Section 234F):
- ₹5,000 if filed after the due date (Total income > ₹5 lakh).
- ₹1,000 if filed after the due date (Total income ≤ ₹5 lakh).
