What is ITR-2?
ITR-2 is an Income Tax Return form for individuals and Hindu Undivided Families (HUFs) who have income from salary, multiple house properties, capital gains (from shares, mutual funds, property), and foreign assets or foreign income. It is the upgrade to ITR-1 for taxpayers with more complex income sources.
ITR-2 cannot be used by individuals or HUFs having income from business or profession — they must use ITR-3 or ITR-4.
Who Should File ITR-2?
- Resident individuals with income exceeding ₹50 Lakh
- Non-Resident Indians (NRIs) with Indian income
- Individuals with income from more than one house property
- Individuals with Short-Term or Long-Term Capital Gains (shares, mutual funds, property, gold)
- Individuals with foreign assets or foreign income
- Company directors or shareholders in unlisted companies
- Individuals with agricultural income exceeding ₹5,000
- Hindu Undivided Families (HUFs) — for all types of income except business
Key Income Heads in ITR-2
| Income Head | Examples |
|---|
| Salary / Pension | Salary, allowances, perquisites, pension, gratuity |
| House Property | Rental income from multiple properties, home loan interest deduction |
| Capital Gains | STCG/LTCG from shares, mutual funds, property, gold, bonds |
| Other Sources | Interest (FD, savings), dividends, lottery, gifts |
| Foreign Income | Foreign salary, foreign interest, overseas investments |
Capital Gains Tax Rates (Relevant for ITR-2)
| Asset Type | Holding Period | STCG Rate | LTCG Rate |
|---|
| Listed Equity Shares / Equity MF | <12 months / ≥12 months | 20% | 12.5% (above ₹1.25 Lakh) |
| Debt Mutual Funds / Bonds | <24 months / ≥24 months | Slab rate | 12.5% (without indexation) |
| Immovable Property | <24 months / ≥24 months | Slab rate | 12.5% (without indexation) |
| Gold / Jewellery | <24 months / ≥24 months | Slab rate | 12.5% (without indexation) |
