ITR filing: 8 situations when you CANNOT use ITR-1 form (SAHAJ) for Income Tax Return

ITR-1 Vs ITR-2: The last date to file the Income Tax Return (ITR) is approaching. To avoid last-minute rush, taxpayers are advised to file ITR before the deadline which is July 31.

The ITR-1 form or SAHAJ is the most common form that is used by taxpayers for ITR filing. However, it is important to note that ITR-1 form or SAHAJ is not applicable to all. 

Basically, it is a simple tax return that can be filed by a resident taxpayer having a total income not exceeding Rs 50 lakh. The source of income should include salary/pension, one house property, other sources (interest, family pension, dividend etc.) and agricultural income up to Rs 5,000.

That being said, there are many who cannot file ITR-1 form or SAHAJ. Let's discuss when an individual can and cannot file ITR-1 form or SAHAJ: 

ITR-1 form cannot be used by a person who,  

- is a Director in a company
- has held any unlisted equity shares at any time during the previous year
- has any asset (including financial interest in any entity) located outside India
- has signing authority in any account located outside India
- has income from any source outside India
- is a person in whose case tax has been deducted u/s 194N
- is a person in whose case payment or deduction of tax has been deferred on ESOP
- who has any brought forward loss or loss to be carried forward under any head of income

Lastly, we must note that those who cannot file an ITR-1 form can however fill the ITR-2 form. The ITR-2 form is applicable for Individual and Hindu Undivided Family (HUF).

Furthermore, an applicant who does not have an income under the head Profits and Gains of Business or Profession is also eligible to fill the form of ITR-2.