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Concepts & Tutorials

New Income Tax Return Forms

From Assessment Year 2007-08, tax filing for year 2006-07, you will need to use new IT return forms. These are downloadable from the Income Tax Department web site.

No more “saral” business – the number of forms have increased somewhat and things may be confusing.

The forms are numbered ITR1 to ITR8 and if you choose to file electronically (discussed later) you can use ITR V. FLet me do some basic fundas of tax filing with these new forms.

No more Form 16 and Form 16 A attachments
Salaried persons usually get a Form 16 from their employer. From now on, the Form 16 needn’t be submitted with the IT Return. You need to fill in the relevant details in the tax form itself.

What forms do I use?
There are a number of forms, arranged as subsets.

New Income Tax Return Forms
ITR 1 is for people with salaried income, Income from interest (FDs, NSCs etc.), Pension and/or Agricultural income. This form has Version 1 and Version 2, both are the same except the latter is more broadly laid out. (Instructions)

If you have Income from capital gains (short or long term, even if it’s not taxable) you must use ITR 2. This form is also used if you have rented out a house and have rental income. If you own a house and live in it, and want to claim deduction of Rs. 150,000 on the interest on the housing loan, you must use this form. It’s a superset of ITR 1, meaning that if you have salary and income from house property, you can use this form. (Form, Instructions)

For those of you who are partners in partnership firms, use Form ITR 3. This is a superset of ITR 2, and contains fields for income from all your firms where you are a partner (regardless of whether this is taxable or not). (Form, Instructions)

And for owners of proprietorships, there is ITR 4. (Form, Instructions)

Annual Information Return (AIR)
Section 24 in ITR 1 and Schedule AIR in the others is a section you must fill up if you have:

  1. Cash deposits aggregating to Rs. 10 lakh or more in a year in any savings account in any bank
  2. Credit card payments aggregating to Rs. 2 lakh or more in the year.
  3. Purchase of mutual fund units of more than Rs. 2 lakh in the year (not clear whether it is for one fund or across all funds)
  4. Purchase of Rs. 5 lakh or more worth of bonds or debentures.
  5. Payment of Rs. 1 lakh or more towards purchase of shares of a company
  6. Purchase or sale by you of any immovable property valued at Rs. 30 lakh or more. (This includes houses, apartments etc)
  7. Payment of Rs. 5 lakh or more towards RBI bonds.

You have to fill the aggregate amounts under each of the above (each of which has a code) All authorities of the above (banks, registrars, RBI, Mutual funds etc) are supposed to provide an AIR of all those people who qualify under the above. The IT department will match their returns with yours and I think they intend to find those who don’t declare such investments and assess them closely.

No more duplicates
You do not have to submit two copies of the forms. There is an “acknowledgement” which is enough to state you have made the return. But for your own sake maintain copies of what is filed.

Due Date: July 31, 2007
You should submit returns by the due date, otherwise strange things will happen. And you’ll have to pay interest at 1% per month (non compounded).

If enough people want detailed instructions I will give it a shot.

  • Hardesh Singh says:

    >Dear Sir,

    More information on the ITR filiing for young software professionals like me will be really helpful.

    Will look forward for a detailed article for novices like us.

    Thanks for all your articles they are very informative.

  • Ranjit kumar says:

    >Hi deepak,

    What is the impact on a person who does not pay any tax other than the one that company deducts because most of the people in the salaried class doesnt care to declare any other income. How the IT department gets to know about these details. And one more thing you have mentioned a point “Payment of 1 lakh rupees against purchase of shares in a company” – Does that mean 1 lakh in all the companies shares you own or any company shares which are worth 1 lakh

  • Deepak Shenoy says:

    >hardesh: Thanks!

    Ranjit: If you don’t declare any income and the IT department gets to know (through either AIRs of various instititions, or interest TDS that is cut by banks) they can decide to take action and levy penalty which can even be more than 100% of such income.

    Your taxes may be reassessed anytime for seven years after filing a year’s return.

    1 lakh means one lakh in one company (AFAIK).

  • karthik says:

    >Hi Deepak,

    Most companies are considering investment proofs upto january or february. I have opted for 3 SIPs of 3 ELSS funds of Rs.2000 each. In my company i have shown my proofs upto January. So i had paid more tax. I have my Rs. 12000 under section 80C.

    So how do i claim my refund? What is the procedure? Can we file returns of ITR1 form electronically? Do we such facility?

    There was a chat on rediff about this yesterday. In that the advisor specified that for the Assessment Year(2007-2008) and financial Year(2006-2007) we can use Saral (Form 2D and 2F) forms. I heard income tax dept has issued a notification on this. Is this true?


  • Deepak Shenoy says:

    >Karthik: You can claim a refund from the tax dept in the ITR forms.

    You can file electronically – the Income Tax website has links to do so. If you have a digital signature you can get an acknowledgement online, otherwise you have to file a paper return signed by you (just summarising the online return)

    I am not sure about this using Saral business. Read this notification – Saral has been replaced.

  • Pradeep says:


    I’d be interested in the details.
    Appreciate your effort put into your articles.


  • Deepak says:


    Slightly unrelated, thought will mail you realised dont have your mail id. anyways, remember the post you had made on the entry exit loads for MFs and the analysis which showed Quantum as a better fund… I had a feeling that it was becoz the other funds were having a bad time and not becoz quantum was so good. Have not done very detailed analysis, but think I might be right. Can you pl check, i will also run a detailed analysis during the weekend.

    Deepak M Nadiger

  • Anonymous says:

    >Hi Deepak,

    This is regarding the investment details to be shown in the ITR. Should we have to show only the investment in excess of Rs.1 lack in Primary Market or do we have to show the investment made in a company above Rs.1 lac from secondary market also?. I have some confusion over here… Please clarify

  • Deepak Shenoy says:

    >Deepak: Interesting. Have redone the calculations
    as of 31.5.07
    . Seems the theory post load works against quantum! But I still think we should give them a year more to see how it changes when their exit load goes to zero.

    Btw, Reliance Vision has been extraordinary. If you have more details – deepakshenoy at gmail.

    Anon: 1 lakh in a company, whether its primary or secondary market or both…

  • Newbie_Blogger says:

    >Thanks for the useful info, Deepak.

    What about ppl who have capital gains from stocks? Should they use ITR-2 or ITR-1?

    And, another related question: what is the tax rate for capital gains from stocks/mutual funds?

    And regarrding your question, a little more detail would be MOST welcome.


  • Deepak Shenoy says:

    >Newbie: Capital gains means ITR 2. Short term cap gains from stocks/funds = holdign period of less than one year = 10% of gains. More than one year of holding = zero tax, but there is a part of ITR 2 where you have to declare such gains.

    More details are coming

  • Anonymous says:

    >Hi Deepak

    Thanks for informative article on income tax return.
    I have a query. I had switched my job twice in last finicial yr. I had given certificate of income from both the companies to current one. Since last dt of submitting investments in current company was in feb, I could not submit my MF investment done in march. I also have TDS cerificate from my bank for my FD. Hence form 16 issued by my current organisation cannot be final income tax calculation. Is it absolutely necessary to have income tax calculation done by CA? Or Can I calculate my income tax and file the return using ITR1.

    Thanks and Regards

  • Deepak Shenoy says:

    >Raj: yes of course you can do the calculation yourself. You do not need a CA to calculate tax.

  • Anonymous says:

    >Hi Deepak,
    Your blog is quiet informative, but I have got few doubts in my case.
    I invested Rs 50,000/- amount in few Scrips. After some I sold them. Few of the scrips made profit and some are in loss.
    kindly tell me whether how I have to pay my short term tax..
    Thanx in advance

  • Deepak Shenoy says:

    >Prasad: You have to calculate the “net” short term capital gain (profits minus losses). Remember you can only offset short term losses against short term gains (not against long term gains).

    Also, only the “realised gains” are taxed (i.e. only the amount that you have actually sold are taxed, not those you still hold)

  • Anonymous says:

    >Hi Deepak,
    Thanx for your quick response.
    Please tell me about the Income tax on Mutual Fund Redemptions.
    Thanx in advance

  • Deepak Shenoy says:

    >Prasad: Equity mutual fund (>65% equity) redemptions are just like selling shares. Other mutual funds have 10% long term gains or 20% indexed gains whichever is lesser (> 1 yr of holding) and short term is added to your regular income and taxed at your marginal rate.

  • shilpi says:

    >Hi Deepak,

    I want to claim a refund on my house Rent(HRA) and education loan (I did not submit the proofs to my company, so tax got deducted). Which return form do you recommend

  • shilpi says:

    >Another thing I read was – no need to submit form 16 or other documents, is that true

  • Deepak Shenoy says:

    >Shilpi: You can recalculate your tax based on your proofs and claim a refund. Maintain the records with you – but it’s possible that the tax department will not consider it.

    You cannot submit any attachment with the ITR forms. No Form 16, or recalculation of tax or proofs etc. They will get back to you if they need clarifications.

  • Anonymous says:

    This blog is informative.

    Regarding short term gains in the stcok market investments, do we need to submit the Digiatl contrat notes to the IT dept. What is the way we need to inform them this and all my invetments and these are my gains/losses?


  • Deepak Shenoy says:

    >Satya: You don’t need to submit them transaction or contract notes. Keep them with you (in case they ask later during assessment). What you need to do is enter the capital gains amount in ITR-2 in the specific columns.

  • Ravi Sankar says:

    >Hi deepak,
    I am in confusion whether to use ITR-1 or ITR-2, my only sources of income in last year were from
    1) My Employer
    2) Interest from Savings bank (No FD’s interest) (aggregate amount <300 Rs)
    3) Dividend from SBI Magnum Taxgain

    Please help me in which form i have to use.

    If i have to use ITR-2,do i have to mention the interest amount and dividend in EI(Exempt Income) part ?

    I am confused because most of my friends having dividend income(from Tax saving MF’s) are not mentioning that source(as it is tax-free) and only submitting ITR-1

  • Deepak Shenoy says:

    >ravi: SB interest does attract tax AFAIK (even if it’s only 300, unfortunately!)

    You need to fill in ITR2. Dividend is in EI part, but interest is in the main interest received bits.

  • G.Sridhar Kumar says:

    >Dear Sir,
    I am Dr.G.Sridhar Kumar from hyd, will you please give me dome feed back regarding the ward number and circle and some format about how to fill ITR 4 form.
    thank you

  • Anonymous says:

    >Hi Deepak,

    I have traded in futures and options. Which form should I use? Will it be treated as business income and should I use ITR-4? Also, if I am just rolling over my positions each month, will I have to declare the accrued losses/gains?


  • Sumit Chawla says:


    Any idea about where to put the deductions in ITR-1. I mean HRA,LTA,Converynce Allowance etc. There seems to be no column for that.

    Sumit Chawla

  • Deepak Shenoy says:

    >karthik: F&O should be capital gains income technically. Should need ITR-2. Consult a CA though.

    sumit: No need for all that. All you need is your net income as mentioned in your Form 16.

  • Sumit Chawla says:

    >Thanks Deepak..

    By Net income do u mean
    Net Income = Gross Salary income – (HRA + LTA + Employment Tax)

    Please throw some light on that

    Sumit Chawka

  • Deepak Shenoy says:

    >sumit: In your form 16, there will be something called “net income” or “Taxable income” which is what you need to use in this field. This is after they remove all deductions (HRA, 80C, Prof tax, LTA, Medical allowance etc)

  • Sumit Chawla says:

    >Yes thats there. But you mentioned 80C also. That i think we need to mention in ITR-1 form under column
    4 Deductions under chapter VI A (Section)

    Please correct me if am wrong.


  • Deepak Shenoy says:

    >Sumit: Ah yes, I stand corrected. Income after All other deductions except VIA (80C etc) should be the income reported…sorry about that.

  • Sumit Chawla says:

    >Thanks a lot Deepak..

    Information given by you is indeed very helpful..


  • Rishi says:

    Thanks for the very helpful information.
    One question, how to find the Ward No/Circle for IT Return Form.
    I am a salried employee.. with my permanent address at Amritsar, however I am working in New Delhi with TCS Ltd, that has corporate office in Mumbai.

  • Shekar says:

    >Dear SIr,

    This is shekar from Hyderabad. Actually i am talking a HOme loan from Private Bank. So they need Form-16. I am trying to ask from my copany abou that, but CA is not ready togive now. Actually i was joined in June 2007. May be i can get in the Jan i hope, if i am not wrong. But he is saying that i will getting the form on the may2008. BUt without Form-16 i cannot get the loan. Please provide the information ASAP how to get the form immeditely.


  • Nithin says:

    >HI Deepak,
    Nice blog and its helped me a lot. I have a small dought. clarify me.

    I was worked in a employer last 8 months and i have payed the tax( deducted by the company).i resigned the job and came out. but i didn’t get my Form16 and no way to get this now. I came to know thru this blog there is no need to attach the form16 for returns. can you pls verify me the same is it possible without form 16 to fill the returns and also tell me how can i do that.

    I have all that 8 months pay slip with me the clear tax deduction details.

    Help me on this


  • Anonymous says:

    >Dear Sir,
    My dad have income only from
    Long term investment ( stock )
    that exceeds 5 lakhs. Does he need
    to file Income Tax?


  • JUSTIN RULES says:

    >Guys can anyone tell me if there is anyway to to file an income tax returns without a form16,

  • Saurabh M says:

    >Can we file income tax twice with in the same year, In my case i had given soft copy of form16 to someone but ont sure whether thay had filled or not , so i am thinking of filling online also

  • dharmendra says:

    >Hi Deepak, i just want to ask one question that is i have made my PAN card from my hometown but now i am living in other city so where can i submit my return in my hometown or here.

  • Deepak says:


    I have a questions,

    I was issued a form16 from my employer. I have misplaced the form. Now when i ask for a duplicate form16, they tell me that it is against company policy to reissue the form16. They are ready to give me photo copy.

    Now how can i file income tax return with the photo copy of form 16

  • Mohan says:

    I made a short term loss of Rs 2 lakhs in F& 0 of shares during financial year 2012 -13.
    Can I show this loss in my IT return , If so in which form ( ITR1…..) and where I have to show my return , Iam a salarised person and paying IT.