The Income Tax Department allows salaried individuals to file their ITR easily using Income Tax Return Form ITR-1. This is because ITR-1 does not require much information to be filled in comparison to other ITR forms. That is why it is also called Sahaj Form. However, not all salaried individuals can file their tax return using ITR-1 form. If someone has made some major transactions in the financial year 2022-23 (AY 2023-24), then they may be ineligible to use ITR-1.

Who is eligible to file ITR-1 (SAHAJ) in FY 2022-23?

ITR-1 i.e. Sahaj form can be filed by such taxpayers who-

• Be an Indian resident.
• The total income in the financial year 2022-23 (AY 2023-24) should be less than Rs 50 lakh.
• Income source should be salary, pension or family pension.
• You have income from a house property.
• Agricultural income up to Rs.5,000.
• Earning from interest and dividend from bank, post office.

Who is not eligible to file ITR-1 Sahaj Form for FY 2022-23?

If a person earns income from any of the sources mentioned below then he cannot file ITR using ITR-1 form. People in the list given below cannot file ITR from ITR-1.

• Individuals with an annual income of more than Rs.50 lakh.
• RNOR and NARI cannot file ITR-1.
• People who have more than one house cannot fill ITR-1.
• Income from horse race, lottery or legal gambling cannot fill ITR-1.
• If you have short term or long term capital gains from the sale of shares, mutual funds, land, you cannot file ITR-1.
• Earning more than Rs 5,000 through agriculture.
• People who are getting income from both business and job.
• If TDS has been deducted for withdrawing money from bank or post office in excess of the prescribed limit, then ITR-1 cannot be filed.
• Individuals who have any asset in a foreign company.
• People who have invested in non listed stocks.
• Be a director of a company or have a bank account abroad. Such persons cannot file ITR-1.

The post Big news for Taxpayers! These taxpayers will not be able to file ITR-1 form, know income tax rules first appeared on Rightsofemployees.com.

So, at this time most of the salaried class people must be busy scanning their income and expenditure for the previous financial year and assessment year. However, the taxpayer should be aware that different ITR forms are applicable for individuals earning different types of income.

The easiest form among the various ITRs issued by the Income Tax Department is ITR-1. At times, ITR-1 is filed as a standard ITR form by taxpayers without understanding the exact eligibility to file the correct ITR form. Therefore, it is important for taxpayers to know under what circumstances the ITR-1 form cannot be filed.

Who can use ITR-1 form for ITR filing?

Income tax experts say that ITR-1 is a simple tax return form, which can be filed by a resident taxpayer whose total income does not exceed Rs 50 lakh. Income from sources like salary, income from other sources and only one house property is reported. It needs to be noted here that the return cannot be used by a director of a company or ESOP of a startup or tax deferred for a person having agricultural income. 5000 or has capital gains income.

Let us know when an earning person cannot use ITR-1 form while filing ITR for FY 2021-22 or Assessment Year 2022-23:

Annual income above 50 lakhs
If the earning person is a salaried person and has no other income, but the total annual income is more than 50 lakhs, then ITR-2 is the correct form for such taxpayer.

Income from more than one house property
If one has a house property, then the correct ITR form is ITR-1. But if there are more than one house properties, then one cannot file ITR-1.

income from agriculture
We all know that income from agriculture is not taxable. While filing income tax return, one needs to report income from agriculture above Rs 5000. Though agricultural income is not taxable, it is only required to determine the slab rate for taxation. And in such cases ITR-1 cannot be filed.

Equity investment in an unlisted company
If a salaried taxpayer owns equity in an unlisted company, then in such a case, the earning person is not allowed to file ITR using Form ITR-1.

being a director of the company

If the taxpayer is a director in a company, then in such a case, he cannot use the ITR-1 form.

Excess TDS Payment

If TDS is deducted on withdrawal of money in any bank/post office account in excess of the limit of 1 crore prescribed under section 194N, then an earning person cannot use ITR-1 form.

stock mutual fund investors

If the taxpayer is a salaried individual and is investing in shares or mutual funds, one can file ITR-1. But once these shares are sold or the mutual fund is redeemed, one cannot file ITR-1. The correct form for such income is ITR-2 or ITR-3.

HUF family member

If a taxpayer belongs to Hindu Undivided Family (HUF), then he cannot use ITR-1 form for filing ITR.

property outside India

If an earning person fulfills all the criteria of ITR-1 but has assets outside India, then the taxpayer cannot file ITR-1.

Income from freelancing

Many software professionals do some work as freelancers on weekends or in their spare time. Income from freelancing is income from business or profession. In such a situation, no one can file ITR-1. Such people need to file ITR-4 or ITR-3, as the case may be.

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