ITR Filing 2024-25: Which income tax return form should salaried employees choose- ITR-1 or ITR-2?

ITR Filing 2024-25: The Income Tax Department (I-T Department) extended the ITR filing deadline from July 31, 2025, to September 15, 2025, today (Tuesday, May 27, 2025). It is more than one and a half months from now, but many individual taxpayers find themselves at the crossroads of selecting the right form to file their income tax return (ITR 2024-25). Many taxpayers don’t know if they should file ITR-1 or ITR-2. Let’s have a look at the suitable ITR form for you!

ITR filing for salaried individuals   

The ITR filing for salaried-class individuals begins with the issuance of Form 16 from their respective workplaces.

Until last year (for the Assessment Year 2024-25), they would file ITR-1 (Sahaj) when their income sources were restricted to salary or pension, interest from savings and fixed deposit dividends, agriculture income below Rs 5,000, and one home property.

But Budget 2025 has brought a few changes.

Now taxpayers earning capital gains through the sale of listed equity shares or equity mutual funds can also fill ITR Form 1.

However, they can use it only when their capital gains (taxed at 12.5 per cent) are not exceeding Rs 1.25 lakh in FY24-25.

How taxpayers may choose between ITR-1 & ITR-2, which is meant for complex ITR filing. 

ITR-1 (Sahaj) 

The meaning of Sahaj is simple or uncomplicated. It is a simple form for salaried-class taxpayers and pensioners.

When you go to the Income Tax Department website, you can find a pre-filled ITR-1 form, which has income details, personal information, and financial transaction data for quick and easy ITR filing.

Taxpayers can verify their ITR data with Form-16 and their bank account statements.

They can also check it from Form 26AS and the Annual Information Statement (AIS).

After matching the details, they can complete the process of online ITR filing.

Who can choose ITR-1 form?

Resident (and ordinarily resident) individuals who have income of not more than Rs 50 lakh can choose it.

The income can come through salary/ pension, agriculture (up to Rs 5,000), income from savings or fixed deposits, family pension, dividends, and one house property (excluding cases where one has suffered a loss).

Taxpayers who earned long term capital gains of up to Rs 1.25 lakh under Section 112A from listed equity shares or equity mutual funds can also use Form ITR-1 for FY24-25.

When not to choose ITR-1

You can’t choose ITR-1 all the time. The Income Tax Department has put certain conditions for not filing the ITR-1 form. Know when you don’t need to choose the ITR-1 form. 

• If your total income exceeds Rs 50 lakh

• If you have earned more than Rs 1.25 lakh in capital gains under section 112A

• If you are working as a director in a firm

• If you own unlisted equity shares

• If you have earned foreign income during FY24-25

• If you have any foreign accounts or assets (that also include financial interest in any entity)

• If deduction/payment of your tax has been deferred on ESOP

In these conditions, you have to choose ITR-2. The form is for individual taxpayers who don’t have any income under the head “profits and gains from business or profession”.