The Rise of India's Salaried Investors: ITR-2 Grows Fastest at 27%
The Quick Answer
ITR-1 dominates with 3.29 crore filings — almost half of all returns. But the real story is ITR-2's explosive 27% growth as more Indians invest in stocks and mutual funds.
Complete Filing Data (FY 2024-25)
Year-on-Year Growth: ITR-2 is Exploding
| Form | FY 2023-24 | FY 2024-25 | Growth |
|---|---|---|---|
| ITR-1 | 3.17 Cr | 3.29 Cr | +3.8% |
| ITR-2 | 62.8 Lakh | 80 Lakh | +27.4% |
| ITR-3 | 1.20 Cr | 1.25 Cr | +4.1% |
| ITR-4 | 2.00 Cr | 2.13 Cr | +6.4% |
| ITR-5 | 17.2 Lakh | 17.9 Lakh | +4.5% |
| ITR-6 | 10.5 Lakh | 10.8 Lakh | +3.3% |
| Total | 7.30 Cr | 7.78 Cr | +6.6% |
Why is ITR-2 Growing So Fast?
ITR-2 grew by 27.4% — far outpacing other forms. The reason? More Indians are:
- Investing in stocks and mutual funds (capital gains)
- Trading in crypto (taxable from FY 2022-23)
- Owning multiple properties
- Earning foreign income (NRIs, remote workers)
If you sold stocks, redeemed mutual funds, or have crypto gains — you likely need ITR-2, not ITR-1.
Which Form is Right for You?
ITR-1 (Sahaj)
3.29 Cr filers • Simplest form
Use if you have:
- Salary income up to Rs 50 lakh
- One house property
- Interest income, family pension
- Agricultural income up to Rs 5,000
Cannot use if: Capital gains, multiple properties, foreign income, business income
ITR-2
80 Lakh filers • Growing fastest
Use if you have:
- Capital gains (stocks, mutual funds, property)
- Crypto/VDA income
- Income above Rs 50 lakh
- Multiple house properties
- Foreign income or assets
- Director in a company
Cannot use if: Business/profession income
ITR-3
1.25 Cr filers • For business owners
Use if you have:
- Business or profession income
- Partner in a firm
- Freelance income (not using presumptive)
- Intraday trading or F&O
Most comprehensive form for individuals
ITR-4 (Sugam)
2.13 Cr filers • For small businesses
Use if you're opting for presumptive taxation:
- Section 44AD (business, turnover up to Rs 2 Cr)
- Section 44ADA (professionals, receipts up to Rs 50 lakh)
- Section 44AE (transport business)
Simpler than ITR-3, no need to maintain books
Complete Form Comparison
| Criteria | ITR-1 | ITR-2 | ITR-3 | ITR-4 |
|---|---|---|---|---|
| Salary Income | Up to Rs 50L | Any amount | Any amount | Up to Rs 50L |
| Capital Gains | No | Yes | Yes | No |
| Business Income | No | No | Yes | Presumptive only |
| Multiple Properties | No (only 1) | Yes | Yes | No (only 1) |
| Foreign Income | No | Yes | Yes | No |
| Crypto/VDA | No | Yes | Yes | No |
| F&O Trading | No | No | Yes | No |
| Complexity | Easiest | Moderate | Complex | Easy |
Common Mistakes to Avoid
Filing ITR-1 When You Should File ITR-2
This is the most common mistake. If you:
- Sold stocks or redeemed mutual funds (even at a loss)
- Have crypto transactions
- Earned income above Rs 50 lakh
- Own more than one house property
You must file ITR-2, not ITR-1. Filing the wrong form can lead to notices from the IT Department.
ITR-3 vs ITR-4: Which One?
If you have business income, the choice depends on:
- ITR-4: You're opting for presumptive taxation (simpler, no books required)
- ITR-3: You maintain proper books, have losses to carry forward, or do F&O trading
Once you file ITR-3, you can't go back to ITR-4 for 5 years. Choose wisely.
Key Takeaways
- ITR-1 is still king with 42% share — but only for simple salaried individuals
- ITR-2 is growing fastest (27% YoY) as more Indians invest in markets
- ITR-4 is popular among freelancers and small businesses (27% share)
- If you have any capital gains, you need ITR-2 or ITR-3
- Filing the wrong form can trigger IT notices — check eligibility carefully
Data Source: Income Tax e-Filing Portal statistics for FY 2024-25, accessed February 2026.