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Rule 164Published

Rule 164: ITR forms, eligibility exclusions and verification methods

Rule 164 sets the return forms and furnishing methods for the tax year beginning 1 April 2026. Choosing a form requires checking both its positive eligibility conditions and its exclusions, then using the verification method permitted for that taxpayer.

Official notified Income-tax Rules, 2026

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This article is for general information. Read the official Rules and applicable Act amendments, including the Taxation and Other Laws (Amendment) Act, 2026. If you need professional advice for your situation, contact Bizeneed.

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Rule 164 - Forms, eligibility, verification etc. in respect of return of income

(1) The return of income required to be furnished under section 263(1) or section 268(1)(a) or section 280, relating to the tax year commencing on the 1st April, 2026, shall be in accordance with the provisions of this rule.

(2) Subject to the provisions of sub-rule (3), return of income shall be in Form SAHAJ (ITR-1) and be verified in the manner indicated therein in the case of a person being an individual, who is a resident other than not ordinarily resident and where the total income includes income chargeable to income-tax, under the head — (a) "Salaries" or income in the nature of family pension as defined in section 93(1)(d); or (b) "Income from house property", where the assessee does not own more than two house property and does not have any brought forward loss or loss to be carried forward under the head; or (c) "Income from other sources", except winnings from lottery or income from race horses and does not have any loss under the head; or (d) ―Capital gains‖, where assessee has only long-term capital gains under section 198 not exceeding ₹ 125000 and does not have any brought forward loss or loss to be carried forward under the head.

(3) A person shall not be eligible to file ITR-1, if he — (a) has assets (including financial interest in any entity) located outside India; or (b) has signing authority in any account located outside India; or (c) has income from any source outside India; or (d) has income to be apportioned in accordance with provisions of section 10; or (e) has claimed deduction under section 93, other than deduction claimed under clause (d) of sub-section (1) of the said section; or (f) is a director in any company; or (g) has held any unlisted equity share at any time during the tax year; or (h) is assessable for the whole or any part of the income on which tax has been deducted at source in the hands of a person other than the assessee; or (i) has claimed any relief of tax under section 159 or deduction of tax under section 160; or (j) has agricultural income, exceeding ₹ 5000 ; or (k) has total income, exceeding fifty lakh rupees; or (l) is a person in whose case tax has been deducted under section 393(3) [Table : Sl No. 5]; or (m) is a person in whose case payment or deduction of tax has been deferred under section 391(2) or section 392(3); or (n) has any income of the nature on which the tax is determinable as per the provisions of Part A of Chapter XIII of the Act.

(4) Return of income shall be in the case of a person being an individual not being an individual to whom sub-rule (2) applies or a Hindu undivided family, where the total income does not include income under the head business or profession, be in Form No. ITR-2 and be verified in the manner indicated therein;

(5) Subject to the provisions of sub-rule (6), return of income shall be in Form SUGAM (ITR-4) and be verified in the manner indicated therein, in the case of a person being an individual or a Hindu undivided family, who is a resident other than not ordinarily resident, or a firm, other than limited liability partnership firm, which is a resident, – – (a) deriving income under the head "Profits or gains of business or profession" and such income is computed in accordance with special provisions referred to in section 58 for computation of such income; and (b) has, ―Capital gains‖, if any, where assessee has only long-term capital gains under section 198 not exceeding ₹ 125000.

(6) A person shall not be eligible to file ITR-4, if he — (a) has assets (including financial interest in any entity) located outside India; or (b) has signing authority in any account located outside India; or (c) has income from any source outside India; or (d) has income to be apportioned in accordance with provisions of section 10; or (e) has claimed deduction under section 93, other than deduction claimed under section 93(1)(d) thereof; or (f) is a director in any company; or (g) has held any unlisted equity share at any time during the tax year; or (h) has total income, exceeding fifty lakh rupees; or (i) owns more than two house properties, the income of which is chargeable under the head "Income from house property"; or (j) has any brought forward loss or loss to be carried forward under any head of income; or (k) is assessable for the whole or any part of the income on which tax has been deducted at source in the hands of a person other than the assessee; or (l) has claimed any relief of tax under section 159 or deduction of tax under clause (d) of sub-section (1) of the said; or (m) has agricultural income, exceeding ₹ 5000; or (n) has income of the nature specified in section 17(1)(d) on which tax is payable or deductible under section 391(2) or section 392(3); or (o) has any income of the nature on which the tax is determinable as per provisions of Part A of Chapter XIII of the Act.

(7) Return of income shall be in Form No. ITR-3 and be verified in the manner indicated therein in the case of a person being an individual or a Hindu undivided family other than the individual or a Hindu undivided family referred to in sub-rule (2) or sub-rule (4) or sub-rule (5) and having income under the head ―Profits or gains of business or profession‖.

(8) The return of income shall be in Form No. ITR-5 and be verified in the manner indicated therein in the case of a person not being an individual or a Hindu undivided family or a company or a person to which sub-rule (10) applies.

(9) The return of income shall be in Form No. ITR-6 and be verified in the manner indicated therein in the case of a company not being a company to which sub-rule (10) applies;

(10) The return of income shall be in Form No. ITR-7 and be verified in the manner indicated therein, in the case of a person including a company, whether or not registered under section 25 of the Companies Act, 1956 (1 of 1956) or section 8 of the Companies Act, 2013(18 of 2013) ,required to file a return under section 349 or Schedule VIII [Table :Sl. No. 1. D(f)] or section 263(1)(a)(iv) or (v).

(11) The return of income shall not be accompanied by a statement showing the computation of the tax payable on the basis of the return, or proof of the tax, if any, claimed to have been deducted or collected at source, or the advance tax, or tax on self-assessment, if any, claimed to have been paid, or any document or copy of any account or form or report of audit required to be attached with the return of income under any of the provisions of the Act.

(12) The return of income referred to in sub-rule (1) shall be furnished by a person mentioned in column 2 of the following Table in the manner specified in column 3 thereof:

Sl. No.PersonManner of furnishing return of income
1.CompanyElectronically under digital signature.
2Any person whose accounts are required to be audited under section 63(a) Electronically under digital signature; or (b) transmitting the data electronically in the return under electronic verification code.
3.Any person other than person referred in Sl. Nos. 1, 2 and 4(a) Electronically under digital signature; or (b) transmitting the data electronically in the return under electronic verification code; or (c) transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V.
4.An individual of the age of eighty years or more at any time during the tax year, who furnishes return in Form No. SAHAJ (ITR-1) or Form No. SUGAM (ITR-4)(a) Electronically under digital signature; or (b) transmitting the data electronically in the return under electronic verification code; or (c) transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V; or (d) paper form.

(13) For the purposes of sub-rule (12), "electronic verification code" means a code generated for the purpose of electronic verification of the person furnishing the return of income as per the data structure and standards specified by Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems).

(14) Where a return of income relates to the tax year commencing on the 1st April, 2025 or any earlier tax year, it shall be furnished in the appropriate form as applicable in that tax year.

Rule breakdown

ITR-1: check the limited income categories and every exclusion

The stated resident individual, other than not ordinarily resident, may use SAHAJ only within the listed income categories and subject to sub-rule (3). These include the specified salary or family-pension, house-property, other-source and limited section 198 gain descriptions.

The rule lists exclusions involving foreign assets, signing authority or income, company directorship, unlisted equity, certain deductions or reliefs, specified withholding or deferred-tax cases and other matters. It also limits total income and agricultural income. A salary receipt alone does not establish eligibility.

ITR-2 and ITR-3 divide the relevant individual/HUF cases

ITR-2 applies to the stated individual or HUF cases without business or professional income, outside the relevant ITR-1 category. ITR-3 covers the remaining described individual or HUF cases with business or professional income.

Classify the income correctly and review the full form eligibility rather than selecting a form solely from a familiar label such as salaried or self-employed.

ITR-4 requires both presumptive-income and other conditions

SUGAM covers the specified resident individual or HUF category and resident firm other than an LLP, with income computed under the cited section 58 provisions and the stated limited gain condition where relevant. Sub-rule (6) then adds exclusions.

Foreign connections, directorship, unlisted equity, total-income limits, number of house properties, losses and other specified cases can prevent its use. Presumptive computation alone does not guarantee ITR-4 eligibility.

ITR-5, ITR-6 and ITR-7 are entity and obligation based

ITR-5 covers the stated residual non-individual, non-HUF, non-company category outside sub-rule (10). ITR-6 is for companies outside that sub-rule. ITR-7 applies to persons, including companies, with the listed statutory return obligations.

Identify the legal person and the precise return obligation. A company’s charitable description or registration alone does not replace the cited statutory test.

Use the furnishing method in the table

Companies use digital signature. Persons with the specified section 63 audit requirement may use digital signature or electronic verification code. The residual category has the additional electronic-return-plus-ITR-V route.

An individual aged eighty or more at any time in the tax year who files the specified ITR-1 or ITR-4 also has the listed paper option. This is not a general paper-filing permission for every senior taxpayer.

Annexure-free return does not remove supporting duties

Sub-rule (11) says the return is not accompanied by the listed computation, tax-payment evidence, accounts or audit documents. Keep those records and separately fulfil any applicable report-filing requirement.

Rule 166 expressly treats the specified audit report not being furnished before the return as a defect. Do not read annexure-free filing as permission to omit required audit compliance.

Use the correct year and current official form instructions

The rule applies to the tax year beginning 1 April 2026. Returns for the year beginning 1 April 2025 or earlier use the appropriate form applicable to that year.

Check the complete current form, exclusions and official verification instructions before filing. Limited permitted-gain descriptions must be read with the additional exclusion clauses, not as an unconditional permission for every capital-gain case.

Key takeaways

Eligibility and exclusions both matter

Do not select an ITR from only one income label.

Furnishing methods vary

Company, audited and other categories have different options.

Paper option is narrow

The stated eighty-plus ITR-1/ITR-4 category is specified.

Year-specific framework

Earlier years retain their applicable forms.

Practical checklist

  • Check positive eligibility and exclusions together.
  • Confirm the taxpayer’s legal category and income heads.
  • Use the permitted verification method.
  • Retain supporting records and separate report acknowledgments.

Avoid

  • Do not infer form eligibility from one income source.
  • Do not confuse annexure-free filing with no supporting compliance.

FAQs

Can every salaried person use ITR-1?

No. The complete income, residence and exclusion conditions must be checked.

Does presumptive income always permit ITR-4?

No. The person category and every applicable exclusion remain relevant.

Can every person aged sixty or more file a paper return under this table?

No. Its paper option concerns the specified individual aged eighty or more filing ITR-1 or ITR-4.

Does annexure-free filing mean no audit report is required?

No. Separate report-filing duties remain; Rule 166 identifies the specified missing pre-return audit report as a defect.

Can these forms automatically be used for every earlier year?

Sub-rule (14) requires the appropriate form applicable to the earlier tax year.

Glossary

Electronic verification code
The code generated under the Systems data structure and standards for electronic verification of the filer.

Official sources