What is the ITR 2 Form, Documents and Eligibility

• Web Online CA 402

Tax filing can be a daunting task, especially when you've got forms like ITR 2. In this guide, we will talk about ITR 2 form, helping you understand its purpose, who should file it, and how to navigate through the sections seamlessly.

What is the ITR 2 Form?

ITR 2 form is an important document used by individuals and Hindu Undivided Families (HUF) to file their income tax returns with the Income Tax Department of India. This is applicable to taxpayers who do not have income from business or profession.

Documents required for file ITR 2 Form 

If your income comes from salary, you will need Form 16 issued by your employer.

For interest earned on fixed deposits or savings accounts with TDS deducted, you will need a TDS certificate (Form 16A) from the deductors.

Form 26AS to verify TDS on salary as well as TDS other than salary.

Bank passbook, fixed deposit receipts for calculating the amount of interest.

For rental income, collect details of tenant/local tax payments and interest on borrowed capital to calculate house property income.

If you want to claim any loss for the current year, you will need relevant documents showing the loss incurred.

To claim the loss for the previous year, you will need the ITR-V copy of the previous year showing the loss.

For capital gains from shares, you will need a summary or profit/loss statement for the calculations.

For rented accommodation, retain the rent receipts for HRA calculation, if you have not already submitted it to your employer.

For interest earned on fixed deposits or savings accounts with TDS deducted, you will need a TDS certificate (Form 16A) from the deductors.

Tax-saving deductions under sections 80C, 80D, 80G, 80GG, collect relevant documents like insurance, donations, rent and tuition fee receipts, if not included in Form 16.

Eligibility to file ITR-2 for AY 2024-25

Read the eligibility criteria for filing ITR-2 for AY 2024-25:

Income from salary or pension.

Income from more than one House Property.

Individuals whose agricultural income is more than Rs 5000.

A person who serves as a director of a company or who has invested in unlisted equity shares.

The combined income from the mentioned sources may exceed Rs 50 lakh.

Income from Other Sources.

Who cannot file ITR-2 for AY 2024-25?

Individuals who are eligible to fill out the ITR-1 Form.

Individual or Hindu Undivided Family (HUF) earning income from business or profession.

Tips for Filling Out the ITR 2 Form

Collect Documents : Before you start filling the forms, make sure you have all the required documents like Form 16, bank statement and investment proof.

Preview entries : Accuracy is important when filling out tax forms. Double check all entries to avoid discrepancies and potential audit notices.

Professional help if needed : If you find the forms confusing or encounter complex tax scenarios, don't hesitate to seek assistance from a tax advisor.

File before the Last Date : Make sure you file your tax return before the due date to avoid penalties and interest charges.