Wondering which ITR form is right for you? Here’s your answer

plus AIS, TIS, and 26AS decoded

Today, Foofi wants to introduce you all to a peculiar person. Let's call her X, and she is the boss babe, kickass CEO of LMW Ltd., or Last Minute Works Ltd. Every time her Google calendar tells her that a certain work is due, all she hears is 'Doooo (it later) duuuuuuh.'

X has been planning to file her ITR for the last financial year (FY24-25) for a long time now, but she’s also a firm believer in adrenaline-powered, deadline-fueled, stress-activated performances. And there’s still a week to go until September 15th, so what's the rush? For her, IST just means It's still time!

Now, you’d be lying to yourself if you’re telling Foofi that X is not you. You’ve put off filing your ITR till the last minute, and at long last, you’re here, stepping into the last week of even the extended ITR filing deadline! (It was supposed to be July 31 but was then extended to September 15th).

With just 7 days to go, you’re now suddenly overwhelmed and want to procrastinate even further. But hang on, DON'T.. Foofi’s got your back. In today’s edition, we’ll figure out what form you should opt for out of the assortment of 7 ITRs available and how in the world to read AIS, TIS, 26AS, and much more.

You’ve got a deadline. Get your piping hot cuppa of tea or coffee, your laptop, and a notebook. Let's create a quick checklist for everything you need to file your ITR.

What’s my form? What’s my form? What’s my form? My form is…….

Okay, no Sheila ki jawani here vibes in income taxes! But out of the 7 forms available, only ITR-1 to 4 are relevant for individuals.

ITR-1: Super simple!

The first form (ITR-1), or Sahaj, is the simplest of the lot. If you have an annual income of less than Rs 50 lakh, and your only income source is your salary and just ONE house property, you can file ITR-1. Other minuscule sources, like interest from a savings bank account, family pension, etc., also count.

Say hi to Rushda! She’s 29, and her only source of income is her salary, working with a media firm. All her funds are in a bank account because she finds the stock market to be risky and volatile. ITR-1 would be well-suited for her.

P.S. Do not choose this ITR if you have bought/sold shares or mutual funds in the previous financial year and have made capital gains as a result.

ITR-2: For my investors

But what if you’re still salaried, i.e., do not have business income, and still have investments in stock markets and mutual funds, and have capital gains as a result? Plus, you also have income from more than 1 house property. In this case, you need to file ITR-2.

Meet Yumna. She’s 37, salaried, but has solid investments in stocks and mutual funds. Last year, she had to sell Rs 10 lakh worth of shares, and as a result, made capital gains worth Rs 2 lakh. She also owns 3 houses, out of which 2 yield her rental income.

Again, capital gains can either be long-term or short-term, depending on how long you’ve held your shares, mutual fund units, or assets. But more on that later.

ITR-3: The entrepreneur and F&O girlie

Next is for all my entrepreneurial badass girlies who have made profits from their consulting and freelancing gigs, in addition to having full-time/part-time jobs (we appreciate hustlers!).

ITR-3 is how you report all your financial gains to the taxmen. This form applies even if you have capital gains, income from house properties, or share dividends; you can file that income-related information in this form as well.

Also, if you’ve dabbled in futures and options (F&O) or intraday share trading over the last year, this is your form.

So, meet Tanishka. She’s a kickass visual designer and earns from her freelancing design gigs. In addition to this, she works as a full-time communication consultant with an NGO. Plus, she also earned Rs 50,000 as profits from intraday trading in the stock markets last year. She needs to fill out ITR-3.

ITR-4: For my hardcore business girlies

If you run a full-fledged small business and are a full-time entrepreneur, you’d realize that maintaining detailed books of accounts can be very tedious. So, the government offers you a small respite by letting you opt for a presumptive taxation scheme. If you opt for this scheme, you’ll need to file ITR-4. This form will also cover any long-term capital gains or income from over one house property, in case you have them.

But then, what is a presumptive taxation scheme? In case your business has an annual turnover of up to Rs 3 crore, the government will automatically assume 6% of your turnover for tax calculation, never mind your actual profits or income. In other words, the government presumes your tax liability and relieves you from maintaining elaborate books of accounts.

Similarly, if you’re a CA, doctor, or lawyer, i.e., have an established professional practice, and have an annual turnover of up to Rs 75 lakhs, the government will presume 50% of your annual turnover for taxation purposes.

So, say hi to Himanshi, an amazing pediatrician who runs her own practice in Delhi. She earns well within Rs 75 lakh annually (though we wish she’d earn more!). She can opt for ITR-4 in case she wants to file ITR for her business under the presumptive taxation scheme.

Well, now that you know what form works for you, let's get to decoding AIS, TIS, and 26AS and what use they are to you while filing your ITR.

AIS, TIS, and 26AS: what they are & how to use them (without crying)

AIS, or Annual Information Statement

Think of it as the tax department’s mega financial report card about you: interest from bank accounts, securities transactions, dividends, mutual fund buys/sells, any other high-value spends, plus entries related to TDS (tax deducted at source) or TCS (tax collected at source).

AIS has two parts, where Part A has general information (Aadhaar, PAN, mobile, email, etc.). Part 2 is where the meat is—details of any foreign remittances you’ve made, life or health insurance receipts, mutual funds/stocks you’ve bought or sold during the year, and more.

To access your AIS, log in to https://www.incometax.gov.in/
After logging in, click on the e-File menu.
At last, click on Income Tax Return > View AIS.

TIS, or Taxpayer Information Summary, is AIS’s executive summary, or its tax index. Here, you get information such as taxes already paid and refunds obtained, among others. Nothing much here, but don’t skip it.

26AS, or TDS statement

If there was one document you should certainly have while filing your ITR, it is this.

The old faithful 26AS shows you any and every TDS/TCS deduction that has been made against your PAN during a financial year. Employer deducted TDS from your salary? The bank deducted TDS on the FD interest? You’ll find everything here. Plus, it will also have details of the high-value transactions of shares, mutual funds, or tax deducted on the sale of properties. To find your 26AS:

Log in to https://www.incometax.gov.in/iec/foportal/
Go to the 'e-file' > Income Tax Returns and click on 'View Form 26AS.

So, the ITR Sorting Hat has spoken: you’re a proud salary queen, investor girlie, hustler, or badass entrepreneur.
Now file, e-verify, and let the refund do a little bhangra into your bank.
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See you next Sunday at 10—same chai, hotter finance.