IT Return: Income Tax Department notified Forms 1 and 4 for Assessment Year 2025-26
New Delhi| The Income Tax Department has notified ITR Forms 1 and 4 for the assessment year 2025-26. It is to be filed on behalf of individuals and entities with a total income of up to Rs 50 lakh annually. Individuals earning long-term capital gains of up to Rs 1.25 lakh in a financial year will also now be able to file ITR-1. Earlier such persons had to file ITR-2.
After the notification now in 2024-25 FY (April – March) people with income up to Rs 50 lakh from business and profession, HUF, and firms can start filing IT returns. ITR Form 1 (Sahaj) and ITR Form 4 (Sugam) are simple forms that cater to the needs of a large number of small and medium taxpayers.
The Sahaj form can be filed on behalf of any single person residing in India with an annual income of up to Rs 50 lakh. His income can be up to Rs 5,000 per year from salary, a house, other sources (interest) and agricultural income.
Sugam can be filed of individuals, Hindu Undivided Families (HUFs) and firms (other than Limited Liability Partnerships (LLPs)) with total annual income up to Rs.50 lakhs and income from business and profession. ITR-2 is filed by individuals and HUFs who have no income from profit or receipt from business or profession.
The Central Board of Direct Taxes (CBDT) has made significant changes in the Income Tax Return (ITR) form for assessment year 2025-26, which will benefit salaried taxpayers with long-term capital gains (LTCG), especially from equity shares and mutual funds.
“With the new changes now people can use the simple ITR-1 (Sahaj) or ITR-4 (Sugam) form”, said Sandeep Sehgal, partner-tax at tax and consulting firm AKM Global If their LTCG under Section 112A does not exceed Rs 1.25 lakh and they have no capital losses to carry or set off”
Sehgal further said that “this change streamlines the tax filing process”. This has made it more accessible and less cumbersome for small investors and salaried people. This will promote timely and accurate compliance.”
