The income tax return (ITR) form a taxpayer has to use to file their return will depend on his/her residential status and total income earned from various sources during a financial year (FY). Most of us salaried individuals will have to use ITR-1 form to file our tax return, however, some might have to use ITR-2.
Who should use ITR-2?
According to the Income Tax website, “ITR-2 can be filed by individuals or HUFs who:
Are not eligible to file ITR-1 (Sahaj)
Do not have income from profit and gains of business or profession and also do not have income from profits and gains of business or profession in the nature of:
(iv) commission or remuneration, by whatever name called, due to, or received by him from a partnership firm
Have the income of another person like spouse, minor child, etc., to be clubbed with their income – if income to be clubbed falls in any of the above categories.”
Form ITR-2 submission
A taxpayer must electronically submit Form ITR-2. This can be accomplished entirely online or partially online and partially offline. If the Form ITR-2 is submitted entirely online, certain data, including personal information, salary income, capital gains, dividend income, interest income, etc., are already pre-filled. However, the pre-filled data will need to be imported into the JSON utility if you use the partially online and partially offline method.
Documents needed to file ITR-2
According to the FAQs on the income tax department’s website, here are the 10 documents you need to file your tax return using ITR-2.
- If you receive salary, you must have Form 16 from your company.
- You require TDS certificates, i.e., Form 16A issued by Deductors, if TDS was deducted from interest earned on fixed deposits or savings accounts.
- To confirm TDS on salary and TDS other than salary, you would require Form 26AS. You could download Form 26AS from the e-Filing website.
- Rent-paid receipts are required if you rent your home in order to calculate your HRA (in case you have not submitted the same to your employer).
- You will require a summary or profit/loss statement of any capital gain transactions you had with shares or other securities throughout the year, if any, in order to calculate your capital gain if you had any share capital gains transactions.
- To figure out how much interest you will earn, you need need your bank passbook and Fixed Deposit Receipts (FDRs).
- If your rented home has generated money for you, you will need to figure out your tenant’s rent payment, local tax payment, and interest on borrowed capital (if any).
- You will need the necessary documentation proving the loss if you want to claim any losses you have experienced this year.
- A copy of your ITR-V from the prior year, which discloses the loss, is required if you want to claim a loss from the prior year.
- If the same were not taken into account in your Form 16, you will also require documentation or evidence to claim tax-saving deductions under Sections 80C, 80D, 80G, and 80GG, such as receipts for life and health insurance, donations, rent, and tuition fees, among others.