Which ITR form should I use for returning my taxes on lottery winnings/online gambling winnings in India?


The Income Tax Department has notified 7 ITR forms and each form is required to be filed by different types of taxpayers subject to various factors like sources of income, amount of income and many more.

However, many taxpayers are not able to choose the appropriate ITR Form. Mostly taxpayers are confused between ITR Form-1 and 2 as both ITR Forms are filed by majority of individuals and HUFs.

For example, if an individual has salary income along with income from winning from lottery or gambling then the individual has to file ITR-2 only as the lottery income is not covered by ITR Form- 1 even if the individual has salary income less than Rs. 50 Lakh. Thus, it is very important to learn the applicability of all ITR Forms thoroughly before filing ITR.

In this blog, we will discuss who can file ITR-2 and the other key points related to it.


Major Differences between ITR 1 and ITR 2




Who can file?

Individual only

Individual or HUF

Income Limit

Rs.50 Lakh or less

More than Rs.50 Lakh

House Property


More than 1

Capital Gains

Not included


Winning from lottery and income from Race Horses

Not included


Foreign Income / Holding Foreign Assets

Not included


Holding Equity Shares of Private Company

Not included


Holding Directorship in a Company

Not included


Exempted Income

Agriculture Income to the extent of Rs.5000/-

Agriculture Income exceeding Rs.5000/-

What Is ITR2 Form?

ITR 2 means Income Tax Return Form 2 that is required to be filed by Individuals or HUF not having income from Business or profession.


Who can use Income Tax Return form 2 (ITR-2)?

Any individual or a Hindu Undivided Family (HUF) having
  • All Income from ITR 1, if it is more than Rs 50 Lakh
  • All Income from ITR 1, having more than one House Property
  • Income from  Lottery/Gambling Winnings
  • Capital Gains
  • Foreign Income / Holding Foreign Assets
  • Holding Equity Shares of Private Company
  • Holding Directorship in a Company

Thus, any individual [not being an individual for whom filing of ITR-1 is mandatory] or a Hindu Undivided Family (HUF) where the total income includes any of the above income can use ITR 2.


Who cannot use Income Tax Return form 2 (ITR-2)?

A person who is not an Individual or HUF cannot file ITR-2. Further, such an Individual or HUF shall not have any income from business or profession.


Things to remember while filing ITR-2 Form

Many ITR filers make common mistakes while filing ITR 2. This is why they always seek for how to fill ITR 2. Thus, we have listed certain points that ITR filers must remember while filing ITR2.

  • ITR-2 can be filed only by an individual or HUF having no business or professional income.
  • ITR-2 can be filed only by a Resident, Resident but not ordinary resident and Non-Resident Individual or HUF.


Changes in ITR Form-2 for A.Y. 2021-22

Section 115BAC – Optional Scheme

All the Individuals and HUFs who are eligible to file ITR-2 have an option to choose between the old tax regime and new tax regime under the Section 115BAC of the IT Act, 1961.

If the person opts to be taxed under the new tax regime then the person is required to submit Form 10IE before filing ITR to the Income Tax Department.

Exhibit the Marginal Relief in ITR Form-2 Separately

According to the IT Act, the marginal Relief is allowed to assessees when their net taxable income after all deductions & exemptions is exceeding beyond the threshold limits after which the assessee has to pay surcharge but the net income is above the threshold limit is less than the total amount of Surcharge.

Earlier on, the assessee was not required to show the effect of marginal relief in ITR Form separately. However from Assessment Year 2021-22, the ITR Form-2 has been updated and thus the assessee has to provide the special disclosure of calculation of surcharge before marginal relief and also the computation of surcharge after the marginal relief.

No option to carry forward of TDS if deducted under newly introduced section 194N of the IT Act, which is otherwise available as per the provisions of section 199 read with rule 37BA

As per the provisions of section 199 read with rule 37BA of IT Rules, 1962, credit of TDS is available shall be given for the year wherein respective income is taxable. So, in case if the TDS has been deducted in current year and its income is taxable in next year, in such case assessee is allowed to carry forward the respective TDS and he should claim its credit in the year in which it’s respective income is taxable.
New section i.e. 194N has been introduced in Income tax Act, which is applicable from the assessment year 2021 – 22. According to this new section tax has to be deducted on amount of cash withdrawal from bank subject to certain conditions. Since, withdrawal of cash cannot be considered as income of assessee for any specific year, therefore Rule 38BA specifically states that for the purposes of section 194N, credit for TDS shall be given to assessee for the year in which such TDS has been deducted.
Therefore, it can be concluded that from AY 2021 – 22, applicability of provisions of section 199 read with rule 37BA of the Act is slightly different if TDS has been deducted under section 194N of the IT Act.

One point should be noted that if in case of a person TDS has been deducted under section 194N of the Act, in such case he cannot file ITR 1 for that assessment year, even if otherwise he was liable to file ITR 1 only. Moreover, the said change regarding restriction of carry forward of TDS if it is deducted under section 194N of the Act, has been made in all other ITR forms i.e. ITR 2 to ITR 7.

Dividend Income shall be taxable in the hands of Shareholders

From the A.Y. 2021-22, the dividend income shall be taxable in the hands of Shareholders instead of Company and thus all the ITR Forms including ITR Form2 have been amended to include this income. The dividend Income shall be taxed as Income from other sources.

Nature of Securities transferred to be shown in Schedule 112A & 115AD

From the AY 2021-22, the assessee shall be required to disclose various details of the securities transferred like the nature of securities under Schedule 112A and 115AD.

Date of Cash Donation to be furnished in the ITR Form-2 – Section 80GGA

An assessee shall be eligible to claim deduction in respect of cash donations up-to Rs.2,000/-. Provided that the assessee must not be earning income under the head of “Profits & Gains of Business or Profession”.

From AY 2021-22, the assessees must report the additional detail that is the date on which cash has been donated under the ITR Forms 2, 5 and 6.



We hope all of your doubts related to what is ITR2 and other topics related to ITR 2 Filing are answered. In case of any query, contact your Trustworthy Advisors Manthan Experts.

File Your ITR Now!

Knowledge Source:

Income Tax Return Form for Companies – ITR-6

Income Tax Return – 3 Form (ITR-3)

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