ITR-1 vs ITR-4 (Sugam): Which ITR Form Should You Use?

By the MyTaxLocker Team · Updated 11 June 2026

Most individual filers in India use one of two forms: ITR-1 (Sahaj) for salary and simple income, or ITR-4 (Sugam) for presumptive business and professional income. Picking the right one comes down to where your income comes from and how much it is.

ITR-1 (Sahaj) — for salaried and simple income

ITR-1 is meant for a resident individual whose total income is up to ₹50 lakh and comes from:

• Salary or pension,
• One house property,
• Other sources such as interest income, and
• Agricultural income up to ₹5,000.

It is the natural choice for a salaried employee with a Form 16 and no business income.

ITR-4 (Sugam) — for presumptive business/profession

ITR-4 is for a resident individual, HUF, or firm (other than an LLP) with total income up to ₹50 lakh that includes presumptive income:

• Section 44AD — small businesses declaring income at the prescribed percentage of turnover.
• Section 44ADA — professionals (e.g., consultants, freelancers) declaring income at the prescribed percentage of gross receipts.
• Section 44AE — businesses plying or hiring goods carriages.

Presumptive taxation lets eligible taxpayers declare income at a fixed percentage instead of maintaining detailed books, which is why it's popular with freelancers and small traders.

When neither form fits

You generally cannot use ITR-1 or ITR-4 if you have, for example, a total income above ₹50 lakh, capital gains beyond the limited cases the forms allow, more than one house property, foreign income or assets, or are a company director. Those situations point to ITR-2 or ITR-3. Eligibility conditions are revised periodically, so confirm them for your assessment year.

Quick way to decide

• Salaried with a Form 16, nothing unusual? → ITR-1.
• Freelancer / professional on presumptive (44ADA)? → ITR-4.
• Small trader or goods-carriage operator on 44AD / 44AE? → ITR-4.
• Capital gains, multiple properties, or income over ₹50 lakh? → likely ITR-2 / ITR-3 (outside these two).