Filing the correct Income Tax Return (ITR) is crucial for compliance. ITR-2 is one of the most commonly used forms, but not everyone can file it. This guide explains who is eligible for ITR-2 and who should avoid it.

 

1. What is ITR-2?

ITR-2 is an Income Tax Return form for individuals and HUFs (Hindu Undivided Families) who have:

  • Income from sources other than business/profession (since business income requires ITR-3 or ITR-4).
  • Complex financial transactions like capital gains, foreign income, or multiple house properties.
  1. Who is Eligible to File ITR-2?

 

2. Individuals & HUFs with the Following Incomes:

                  ✔ Salary Income (including pension)
                  ✔ Income from House Property (rental income, multiple properties)
                  ✔ Capital Gains (sale of stocks, mutual funds, property, gold, etc.)
                  ✔ Other Sources (interest, dividends, lottery, etc.)
                  ✔ Foreign Income & Assets (foreign investments, bank accounts, etc.)
                  ✔ Agricultural Income > ₹5,000 (but total income must exceed basic exemption limit)

 Additional Cases Where ITR-2 is Required:

                   ✔ Director of a company (even if income is only from salary)
                   ✔ Individuals with unlisted equity shares

 

3. Who Should NOT File ITR-2?

            Business or Professional Income (must file ITR-3 or ITR-4 instead)

             Income from Presumptive Taxation (Section 44AD/44ADA) (must file ITR-4)

             Small Businesses/Freelancers opting for presumptive scheme

 

4. Documents Required for Filing ITR-2

  • Form 16/16A (for salary/other income)
  • Bank statements & interest certificates
  • Capital gains statements (broker reports, property sale deeds)
  • Home loan interest certificates (if applicable)
  • Details of foreign assets/income (if any)

 

5. Deadline for Filing ITR-2 for FY 2024-25

           July 31, 2025 (unless extended by the government)

 

6. Penalty for Late Filing

  • Late fee: Up to ₹5,000 (under Section 234F)
  • Interest: 1% per month on unpaid tax

 

Conclusion:

     ITR-2 is designed for individuals and HUFs with income from salaries, multiple house properties, capital gains, foreign assets, or other complex sources—but no business income. If your earnings include stocks, property sales, rental income, or overseas investments, ITR-2 is likely the right form for you.