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What is ITR 2 Form and Steps to File ITR-2 Online

Last Update Date : May 03, 2019
Estimated Read Time: 9 min

Are you seeking the details of ITR-2? In this guide by H&R Block, you will read about ITR-2, its component, eligibility criteria, major changes made in this form for AY 2018-19 and the process to file the same.

What is Form ITR-2?

Form ITR-2 is one of the most important forms which you need to file with the Income Tax Department by furnishing your details of income earned and income tax paid.

Who can File ITR 2?

Individuals and HUFs (Hindu Undivided Families) can file ITR 2. This return form will be applicable to you if you receive income from:

  • Salary/pension
  • House property from one or more
  • Capital Gains/ Loss on sale of investments/property (both short-term and long-term)
  • Other sources (lottery, gambling and other legal channels)
  • Being a partner in the firm (earlier there was separate ITR form 3 for this, the ITD has discontinued that form and merged into ITR 2)
  • Foreign Assets/ Foreign Income
  • Dividend income exceeding Rs 10 lakhs taxable u/s 115BBDA
  • Unexplained credit or unexplained investment taxable at 60% u/s 68, 69, 69A, etc.
  • The share of profit of partner from a partnership firm
  • Agricultural income exceeding Rs 5,000
  • If your annual income exceeds Rs 50 Lakh
  • If you are the “Director” of a company or if you have invested in unlisted equity shares

Who cannot File ITR 2?

You cannot file this form if your income includes the following:

  • Income from Business or Profession under any proprietorship
  • Individuals, who are eligible to fill out the ITR-1 Form

[ Read: Which ITR to File for Tax Filing ]

How to File ITR 2?

how to fill itr 2 online

 

You can file form ITR-2 form either offline or online. Click the above image to download ITR 2 Form for the financial year 2016/17 and click here for FY 2015/16.

You can file ITR-2 via two methods:

Offline Method

You can furnish your tax return in a paper form. At the time of submission of the paper return, the Income Tax Department will issue an acknowledgement to you. You can also furnish a bar-coded return.

Online Method

You can file online ITR-2 with the Income Tax Department in the below mentioned ways:

  • Furnish the return electronically under digital signature, after submitting the form, you will receive an acknowledgement to your registered email ID
  • Transmit the data in the return electronically and authenticating it through electronic verification code
  • Transmit the data in the return electronically and after that submitting the verification of the return in Return Form ITR-V

How to Fill ITR-2?

You must keep the following points in mind while you fill the ITR-2:

  • Mention ‘NA’ against any schedule or any item which is not applicable to you
  • Write ‘Nil’ where no or nil figures are required
  • When you are writing a negative figure, put ‘ ‘sign before the figure
  • Other than the total income/ loss and the tax payable, all the other figures should be rounded off to the nearest multiple of ten
  • Under the employer category:
    • If you are a Central/ State Government employee, you should tick on ‘government
    • If you are an employee in a Public Sector Unit, tick on ‘PSU’
  • The accurate sequence to fill ITR-2 will be:
    • Firstly, fill the ‘part A
    • After filling the part A, check all the schedules and fill them according to their applicability
    • Now fill the ‘part B-TI’ and ‘part B-TII’
    • Lastly, verify the details

What is the Structure of ITR 2 Form?

Form ITR-2 has the following components:

  • Part A: General information such as identification, etc.
  • Part B: Outline of the total income and tax computation in respect of income chargeable to tax.
    A space for a statutory verification, which is compulsory if the return, is furnished in paper form.
  • On page 3: Details to be filled if the return has been prepared by a Tax Return Preparer
  • On page 3 and 4: Statement of tax payments on account of advance tax and self-assessment tax, tax deducted at source from salary, tax deducted at source on income other than salary and tax collected at source as per form 27D issued by the collector(s) are to be filled.
  • This is followed by the schedules mentioned below:
    Schedule S: head salaries income computation
    Schedule HP: income from house property
    Schedule IF: partnership firm information in which you are a partner
    Schedule BP: Calculation of income under ‘profit and gains from business or profession’ (income of salary, interest, etc. from firms where you are a partner)
    Schedule CG: Capital Gains income
    Schedule OS: Income from other sources computation
    Schedule CYLA: income after set off of current year’s losses
    Schedule BFLA: income after set off of unabsorbed loss brought forward from previous years
    Schedule CFL: losses to be carried forward to future years
    Schedule VI-A: deductions (from total income) under Chapter VI-A
    Schedule 80G: donations entitled for deduction under section 80G
    Schedule SPI: income arising to spouse/ minor child/ son’s wife or any other person or association of persons to be included in the income of the assessee in Schedules-HP, BP, CG and OS
    Schedule SI: income which is chargeable to special tax rates
    Schedule EI: exempt income
    Schedule PTI: income from Business Trust or Investment Fund as per section 115UA, 115UB
    Schedule FSI: income accruing or arising outside India
    Schedule TR: tax relief claimed u/s 90 or section 90A or section 91
    Schedule FA: Foreign Assets and Income
    Schedule 5A: Statement of apportionment of income between spouses governed by Portuguese Civil Code
    Schedule AL: Asset and Liability at the end of the year (mandatory in case, your total income exceeds Rs 50 Lakh)

How do you Send your ITR-V to the CPC Office?

If you e-file your return, then you will receive the copy of acknowledgement (ITR-V) on your e-mail, you can take print out from there or you can download the acknowledgement copy from the Income Tax Department website and take a print out of it, sign in the space provided and send it to CPC office, Bengaluru. You can also e-verify your ITR-V now by using any of the methods mentioned here.

[ Read: How to Send ITR-V Form to CPC Banglore ]

Major Changes in ITR-2 for AY 2019-20

  • In Part A, under “Residential Status”, you now must provide details about the number of days you stayed in India.
  • If you are the “Director” of a company, you now must use ITR-2 instead of ITR-1 and provide details such as name of the company, PAN, listing status and DIN.
  • If you hold unlisted equity shares, you must use ITR-2 now and provide details of the shares and transaction details.
  • In “Schedule S”, under deductions, there is now a column for the standard deduction of Rs 40,000 u/s 16(ia).
  • In “Schedule CG”, under immovable property section, you now must provide the property buyer details such as PAN, percentage of share, and property details such as address and pin code for short term and long-term capital gains.
  • In “Schedule CG”, there is now a separate section for short term capital gains and long term capital gains by “Pass Through Entities”. You can directly enter the amount of gain as per the applicable tax rate without the details of sale proceeds and cost of acquisition.
  • In “Schedule CG”, there is a new section for providing details of capital gains from sale of listed equity shares or mutual funds, subject to the newly introduced tax rate of 10% u/s 112A.
  • Non-residents reporting long term capital gains u/s 112A, will now have to fill a separate section.
  • In “Long term Capital gains”, under “Set-off current year capital loss with current year capital gains”, there is now a separate column to report DTAA gains and losses adjustments.
  • There is now a separate field for the capital gains taxable at special rates under DTAA for the quarterly breakup of capital gains.
  • In “Schedule OS”, you now must provide additional details of interest on income tax refund and interest in the nature of “Pass Through Income”. The list of sources of income has also been updated with the special tax rates under different sections.
  • In “Schedule OS”, you now must provide details of the quarterly breakup of income from dividends u/s 115BBDA and income from lotteries, crossword puzzles, gambling, etc. referred to in section 2(24)(ix).
  • In “Schedule EI”, if agricultural income exceeds Rs 5,00,000, you must provide details like location of land, area in hectares, whether the land is irrigated or rain-fed and whether it is owned or held in lease. You must provide these details separately for each land.

Changes Made in Form ITR-2 for AY 2018-19

Changes in ITR 2Details
More details of salary and house property incomeOld ITR form required the taxpayers to report only the taxable amount but the new ITR forms require you to report detailed calculation of income from salary and house property.
Penalty for late filing of ITRA new field has been added where the late filers need to provide the details of late filing fees paid.
Capital gains as a result of transfer of unquoted sharesA new filed has been added for the taxpayers to provide information on unquoted shares in accordance with the amendment in the section 50CA of the Finance Act, 2017.
Reporting giftsA field has been added to report the amount taxable as gift.
Credit of refund to foreign bank accountA field has been added where an NRI taxpayer can provide the details of a foreign bank account in which he wants the credit of the tax refund he wants to claim.
Reporting disallowance of expensesA new field has been added to report disallowance of expenses in case of TDS default.
Claiming credit of TDS deducted in the name of another personA new field has been added to facilitate the claim for TDS credit where the TDS was deducted in the name of another person or from a common pool or other similar situations.
Change of applicability for a partner in a firmPartners cannot use ITR 2 – for the Assessment Year 2018-19, an individual or an HUF, who is a partner in a firm, shall be required to file his ITR in Form ITR 3 only.
Claiming relief under DTAAThe form now asks the taxpayer claiming relief as per DTAA to report more details like rate as per treaty, rate as per I-T Act and applicable rate etc.
Claiming exemption on capital gainsThe taxpayers now need to provide more details in the form if they are claiming capital gains exemption.
Reporting of remission or cessation of trading liabilityNew forms require separate reporting of remission or cessation of trading liability in case of income from other sources.
Reporting GST payments and refundsNew columns have been introduced in the ITR forms to report the details of GST paid and refunded.
Removal of gender fieldTaxpayers now do not need to mention their gender in the form.

All these changes have been made by the tax department in the ITR form are aimed at making the assessment procedure online. Therefore, we can see that the department is seeking more and more information from the taxpayers to facilitate e-assessment.

Changes Made in Form ITR-2 for AY 2017-18

ChangeDetails
Assets and liablities of Individuals/HUF whose income exceeds Rs 50 lakhs in schedule ‘AL’

 

You are required to declare the cost of immovable property (address too), jeweler, bullion, vehicles, shares, bank and cash balance, etc. Also, description of movable assets.
Income derived as a partner in a Firm You are required to disclose income earned from the firm in which you are a partner along with the details of interest held in the assets of a Partnership firm or Association of persons as a partner or member. Also name, address, PAN of the firm or AOP.
Aadhaar Number

 

As per section 139AA, taxpayers must quote aadhaar number or aadhaar enrolment number while filing ITR.
Other income and in dividend income exceeding Rs 10 lakhsUnder ‘schedule OS,’ you are required to declare unexplained credit or investment and dividend received from domestic companies exceeding Rs 10 lakh.
Amount of cash deposited during demonetisation

 

If you have deposited Rs 2 Lakh or more then, you need to report cash deposited by you in all the bank accounts during the period from 9th November 2016 to 30th December 2016.

Frequently Asked Questions about ITR-2 Form

How to fill short term capital gain in ITR 2?

Under the schedule CG you can mention your Capital gains income. Also under schedule CFL, you can carry forward your losses.

How to calculate income from house property?

Gross Annual Value – Municipal Taxes = Net Annual Value – (Deductions u/s 24 + Standard 30% deduction + interest paid on loan) = Income from house property.

What is housing loan interest exemption limit that can be claimed as deduction?

If the property is self-occupied then the maximum deduction allowed under the head HP is restricted to Rs. 2 lakh but for a rented or deemed rented property there is no limit for tax deduction. But From A.Y. 2018-19 the maximum loss under the head HP that can be set-off against other head of income is also restricted to Rs. 2 lakh and balance can be carried forward for next 8 years.

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CA Madhuri Marne
Madhuri is a tax expert at H&R Block (India) with over a decade of professional experience. Having co-authored a book on economics for the ICAI exam, she now enjoys writing about tax-related topics in a simple and easy manner. Outside of work, Madhuri is passionate about teaching students who are appearing for professional exams.

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