Salaried individuals are generally required to fill out the ITR-1 SAHAJ form when filing their income tax returns. However, if you do not meet certain criteria, you need to fill out the ITR-2 form when filing your return for a particular assessment year.
In case your income constitutes capital gains and rent from more than one house property, you will be required to file ITR-2. In addition, Hindu Undivided Families (HUFs) are also required to carry out ITR-2 filing.
As it requires you to provide more comprehensive details about your income, the ITR-2 form is considered more complex than ITR-1. Read on to learn what ITR-2 is and how you can file it online.
Before you know how to file ITR-2 online, you must be aware of what ITR-2 means and what its applicability is. The Income Tax Department has segregated taxpayers depending on their total income as well as the source from where income is generated.
Depending on these factors, you have to choose the right income tax form. For instance, individual taxpayers as well as Hindu Undivided Families (HUFs) need to file the ITR-2 form. However, they must not be involved in any business or profession.
Here is what the ITR-2 for salaried employees contains:
Part A: Named ‘General’, this part requires you to add personal, bank and tax regime details
Part B: This has two sub-parts where you need to calculate your total income and tax liabilities after accounting for applicable deductions
Schedule Salary: Information on income from salary or pension
Schedule Capital Gains: Income from capital gains for all the assets you own in the short- and long-term
Schedule House Property: Income from house property, whether occupied or rented out
Schedule Other Sources: Income from other sources, such as horse racing
Schedule SI: Details of income chargeable as per special rates
Schedule EI: Details of exempt income that does not attract tax
Schedule SPI: Statement of inclusion of income of your spouse or children to your individual income
Schedule PTI: Income from business trusts and investment as per Sections 115UA and 115UB
Schedule FSI: Income earned in any foreign country
Schedule DI: Income from any deposits or investment that is liable for deductions
Schedule FA: Income generated from holding any asset outside India
Schedule 5A: Information on the division of one’s income between spouses
Schedule BFLA: Income after adjusting losses from the previous year
Schedule CYLA: Income after adjusting losses from the ongoing year
Schedule CFL: Statement of losses to be adjusted to the next financial year
Schedule AL: Information on your assets and liabilities if your income exceeds ₹50 Lakhs
Schedule VI-A: Statement of deductions from your total income
Schedule 80G: Statement of any donation made to a trust or organisation available for deductions under Section 80G of the IT Act
Schedule AMT: Calculation of your alternate minimum taxation (AMT) under Section 115J of the I-T Act
Schedule 80GGA: Statement of donation made for the development of the rural sector or science-related research
Schedule AMTC: Calculation of your annual minimum tax credit (AMTC) under Section 115JD
Schedule TR: Information on taxes paid in foreign countries
Now that you have understood this form’s function and components, check your ITR-2 applicability before filing your returns. ITR2 filling is mandatory if you fulfil these eligibility criteria:
If you have earned income from salary/pension, house property, capital gains, other sources, etc.
If you have earned income from foreign assets
Income from agriculture exceeding ₹5,000
If you are a director of a company or you have invested in unlisted equity shares
If your total income from the above sources exceeds ₹50 Lakhs
Here is a brief overview of changes introduced in ITR-2 for the period 2022-23.
The term ‘accounting period’ has been changed to ‘calendar year ending as on 31st December 2021’ under the Schedule FA
Under the Schedule CG, the indexed and acquisition cost need to be disclosed separately
Year-wise improvement cost details of building or land to be mentioned under the CG Schedule
Interest accrued on PF need to be reported under the Schedule OS
A separate disclosure of dividend income is essential per the new amendment
Taxpayer to select appropriate descriptions pertaining to different clauses for determining residential status
Insertion of new ‘Schedule Tax Deferred on ESOP’
If you are wondering how to file ITR-2, you can do so using both online and offline modes. However, note that only resident individuals over 80 years of age can complete their ITR-2 filling offline.
Here is how to file ITR-2 online:
Open the e-filing portal of the Income Tax Department
Log in to your account using your credentials and enter the captcha code
Select the ‘e-File’ option from the menu
Navigate to the ‘Income Tax Return’ tab
You will be directed to a new page where your PAN details will be auto filled
Go through these details to make sure they are accurate
Select the assessment year as well as ITR-2 as applicable form
Choose ‘Original/Revised Return’ as your preference in the ‘Filing Type’ tab
Hit the ‘Continue’ button to begin your ITR-2 filing
Fill in all the mandatory and applicable fields of your ITR form
Under the ‘Taxes Paid and Verification’ tab, choose the right verification option
Click on the ‘Preview and Submit’ button to check the details you have entered in your ITR-2 form
Hit the ‘Submit’ button to complete your ITR-2 filing
In conclusion, the ITR-2 form is applicable to resident taxpayers and HUFs not earning any income from any business or profession. You can file the ITR-2 form online on the e-filing portal of the Income Tax Department.
As per the Income Tax Act of 1961, any income that you generate by selling capital assets in an assessment year is considered as capital gains.
Yes, as per the IT Act, if you own two houses, only one of them is considered self-occupied. The other property is deemed to be let out, and income from the second house property is taxed as per the applicable tax rates.
You can download ITR-2 from the Income Tax Department website. Navigate to their ‘Forms/Downloads’ section and click on the ‘Income Tax Return’ option. Choose ITR-2 form to download it.
The ITR-2 form is applicable to resident individuals and HUFs who do not earn their income from a business or profession.