ITR 2 : Return for Non-Business Taxpayers with Multiple Incomes

ITR 2 is a return to be file by individuals or HUFs without any income from business or profession.

The due date for filing the income tax return for the Assessment Year 2024-25 is drawing near. Let us explore ITR 2 in detail.

Who is eligible to file ITR 2 in AY 2024-25?

ITR 2 can be file by individuals or HUFs who

• Are not eligible to file ITR 1(Sahaj) i.e.:

1. Income from salary/pension exceeding ₹ 50 lakh.
2. Income from more than one house property.
3. Income from Long-term or Short-term Capital gains.
4. Income from Other sources including winnings from lottery, betting on racehorses etc.
5. Agricultural Income exceeding ₹ 5,000.
6. Resident not Ordinarily Resident or Non-resident status taxpayers.
7. Director of a Company.
8. An individual who has invested in unlisted equity shares of a company.

• Do not have any income from profits or gains of business or profession

• Do not have income from profits or gains of business or profession in the nature of

1. Interest
2. Salary
3. Bonus
4. Commission or remuneration, by whatever name called, received or receivable from a partnership firm.

• Have the income of a spouse, minor child etc to be clubbed with their income, in the same category as above.

Who is not eligible to file ITR 2?

The following cannot file ITR-2 :

• An individual or HUF having income from profits or gains of business or profession.

• A taxpayer who is eligible to file the ITR 1(Sahaj).

Major changes in ITR-2

• A new Schedule VDA has been added to allow for the reporting and computation of income from the transfer of Virtual Digital Assets like cryptocurrencies.

• Finance Act 2023, added section 80CCH for individuals enrolling in the Agnipath Scheme, allowing those that have subscribed to the Agniveer Corpus Fund on or after 01-11-2022 a tax deduction on the full amount deposited in this fund. ITR 1 now has an additional column to fill in the details for section 80CCH. On a similar note, Section 10(12C) has been added as it provides an exemption to any payment received to a person or their nominee from the Agniveer Corpus Fund.

Structure of ITR 2 Form

Part A: General Information

• Schedule S: Salary Income Details
• Schedule HP: Income from House Property
• Schedule CG: Income under Capital Gains
• Schedule 112A:
• Schedule 115AD:
• Schedule OS: Income from Other Sources
• Schedule CYLA: Income after set off of Current Year Losses
• Schedule BFLA: Income after set off of brought forward unabsorbed losses
• Schedule CFL: Losses to be carried forward to future assessment years
• Schedule VIA: Deductions under Chapter VIA of the Income Tax Act
• Schedule 80G: Donations eligible for deduction under Section 80G of the Income Tax Act
• Schedule 80GGA: Donations for scientific research or rural development
• Schedule AMT: Alternate Minimum Tax payable under Section 115JC of the Income Tax Act
• Schedule AMTC: Tax credit under Section 115JD of the Income Tax Act
• Schedule SPI: Income of spouse/minor child/son’s wife which is to be clubbed with the taxpayer’s income and filed
• Schedule SI: Income chargeable to tax under special rates
• Schedule EI: Incomes exempt from tax
• Schedule PTI: Details of pass through status of Business Trust under Section 115UA or Investment Fund under Section 115BUB
• Schedule FSI: Income arising or accruing outside India
• Schedule TR: Details of taxes paid outside of India
• Schedule FA: Details of foreign assets and income from sources outside of India
• Schedule 5A: As per the Portuguese Civil Code, apportionment of income between spouses
• Schedule AL: If total income exceeds ₹50 lakh, details of assets and liabilities of the taxpayer at the end of the year have to be provided
• Schedule tax deferred on ESOP: Under Section 80-IAC, details of the tax-deferred on ESOPs received from the eligible start-ups is to be provided here.

Part B-TI: Computation of the Total Income

Part-B-TTI: Computation of the tax liability on the above total income

Tax Payments

Details of advance tax, tax deducted at source, tax collected at source and self-assessment tax paid.

Taxpayer Declaration

Documents needed to file ITR-2

• Form 16 : which is issue by the employers during the given financial year.

• Form 26AS and AIS : to be downloaded from the income tax portal itself. These provide details about the various transactions entered into by the taxpayer that have been reported, including TDS, interest earned, dividends, capital gains etc. The taxpayer needs to match the details in Form 16 with Form 26AS.
• House Rent receipts

• Bank Statements : Interest from bank account details either from savings accounts or deposits.

• Proofs of deductions : Exemptions and allowances being claimed like House Rent Allowance, investment payment receipts and insurance premium receipts to claim the deductions under Section 80C, 80D etc. While there is no need to attach these supporting documents to the ITR on submission, it is essential to have these documents in handy in case the taxpayer is required to produce them before tax authorities on assessments, inquiries etc.

• Set off and carry forward of losses : the taxpayer has to ensure proper documentation of losses being carried forward to next assessment year and also the availability of ITR V acknowledgement of the loss of the previous year is being set off with current year profits.

• Capital Gains : documents pertaining to capital gains transactions that have been undertaken by the taxpayer in the year and also the details for any exemptions claimed from taxation on capital gains are to be maintained.

• PAN card and Aadhaar card : it is mandatory for taxpayers to link PAN card and Aadhaar card on the income tax website.

Steps to file ITR 2

There are essentially 3 steps for ITR filing as a whole:

Validate Return : Return shall be pre-filled by the Income Tax Department and the taxpayer has to carefully examine the same and confirm the details in each of the 5 sections:

• Personal Information
• Gross Total Income
• Total Deductions
• Taxes paid
• Total Tax Liability

Confirm the Return Summary : there will be a summary of the return which the taxpayer can go through for one last time to find any errors or discrepancies before the submission of the return.

Verify and submit : Taxpayers have to verify the return and finally submit it.

Process for filling ITR-2

• Go to the income tax e-filing website.
• Log in to your account or register an account.
• Click on the ‘e-File’ tab, then the ‘Income Tax Returns’ and then select ‘File Income Tax Return’.
• Select the Assessment Year from the dropdown menu, the current assessment year is 2024-25 applicable for the financial year 2023-24.
• Select the ‘Online’ mode of filing and click on ‘Continue’
• Click on the ‘Start New Filing’ option.
• Select the status applicable to you out of, ‘Individual’, ‘HUF’ and ‘Others’.
• Select ITR-2 and click on proceed. Choose the option applicable to you:

1. Whether filing ITR because income exceeds the basic exemption limit.
2. Filing a return to comply with provisions of Section 139 of the Income Tax Act.
3. Others.

• The details of AIS/Form 26AS have to be verified with the pre-filled information. The details have to be carefully review by the taxpayer. Any changes, if necessary, have to be made.
• The taxpayer has to e-verify the return once it has been submitted. It is important to remember the validation of your bank account for the smooth receipt of refunds.
• Filing of the return is being done on or before the applicable due date. There can be repercussions for not filing within the due date like late fees, losses not getting carried forward etc.

Filing an ITR can be a huge task especially if no careful research is done. It is best to avail help of a professional if required.

FAQs