Tax Consultant
657 Points
Posted on 04 June 2026
The main threshold for AY 2026-27 is Rs 1.25 lakh in long-term capital gains (LTCG) from listed equity shares or equity mutual funds.
Use ITR-1 (Sahaj) if:
- Income from salary, one house property, and other sources only
- LTCG from equity shares or equity MF does not exceed Rs 1.25 lakh in FY 2025-26
- Total income does not exceed Rs 50 lakh
- No business or professional income
You must file ITR-2 if any of the following apply:
- LTCG from listed equity or equity MF exceeds Rs 1.25 lakh
- You have any STCG from shares or mutual funds (any amount triggers ITR-2)
- You hold unlisted shares
- You are a director in any company
- Income from more than one house property
- Foreign income or foreign assets
- TDS deducted under Section 194N (cash withdrawals above threshold)
If you also have business income, it becomes ITR-3, or ITR-4 if you are under presumptive taxation (44AD, 44ADA, 44AE) and total income is within Rs 50 lakh.
For the complete eligibility criteria for all ITR forms AY 2026-27 including the capital gains schedule changes in the new forms, this [ITR forms guide](https://taxgarden.in/blog/new-itr-forms-ay-2026-27-cbdt-notification-key-changes) covers all the conditions with examples.