How To File ITR 2 for Income from Capital Gains for FY 2024-25?

Each person must use the designated IT return form to file their taxes. Individuals and HUFs having income from salaries, multiple home properties, capital gains, overseas assets, and other sources are the target audience for ITR 2. For individuals earning more than Rs. 50 lakhs in a financial year or having investments in stocks, mutual funds, or other assets that generate capital gains, ITR 2 is frequently utilised. Particularly for capital gains and foreign asset and income disclosure requirements, ITR 2 is required. We shall read about ITR 2 filing and its applicability in this article.

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Table of Contents

New ITR 2 Form for AY 2025-26

Eligibility to File ITR 2

Documents Required to File ITR 2

Documents to File Capital Gain ITR Form

Steps to File Income Tax Returns for Capital Gains Online

Conclusion

Frequently Asked Questions

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New ITR 2 Form for AY 2025-26

The ITR 2 form has undergone many key revisions recommended by the Central Board of Direct Taxes (CBDT) to ensure compliance with the most current changes made by the Finance Act of 2024. For taxpayers submitting returns for the assessment year 2025–2026 and thereafter, these modifications are essential. Among the noteworthy updates are:

• Separate Capital Gains Reporting: As a result of structural adjustments made in the Finance Act of 2024, taxpayers are now required to declare capital gains for transactions made prior to and following July 23, 2024, separately.

• Capital Loss on Share Buybacks: As of October 1, 2024, share buybacks will only be permitted if the associated dividend income has been reported under the "Income from Other Sources" heading.

• Increased Threshold for Asset and Liability Disclosure: A revision has been made to the income threshold that requires the mandatory reporting of assets and liabilities. This information must now only be disclosed by taxpayers whose total income surpasses Rs 1 crore (formerly Rs 50 lakh).

• Expanded Deduction Reporting: To improve transparency and categorize tax-saving investments and exemptions, the ITR 2 form now has more reporting options for deductions under sections like 80C and 10(13A).

• New Schedule-TDS Column: To aid cross-checking deductions and increase accuracy, a new column has been introduced to Schedule-TDS to record the precise section under which TDS was deducted (194I for rent, 194J for professional fees, etc.).

Eligibility to File ITR 2

• Any Indian resident, RNOR, or non-resident who is a member of the Hindu Undivided Family (HUF)

• Individuals who are salaried or retired and make more than Rs. 50 lakhs.

• Individuals who sell shares, mutual funds, real estate, and virtual digital assets and make money gains.

• If you rent out several different residences

• If your agriculture income exceeds Rs. 5,000

• If you make money abroad or own assets abroad

• If you serve as a director for any domestic or foreign corporation

• If you own an unlisted equity stake in any business, whether local or foreign

• Individuals who make money from other means, such as winning the lottery or racing horses

• If you have any brought forward/to be carried forward loss under any head of income should report any losses

You cannot file an ITR 2 form if you are employed by a business, profession, partnership firm, etc.

Documents Required to File ITR 2

• Aadhaar Card

• PAN

• Form 16 if you are a salaried Individual

• TDS certificates / Form 26AS

• Bank account details

• AIS/TIS statement

• Challan of the paid taxes

• Original return details (if filing for a revised return)

• Notice-related details (if filing in response to any notice)

Documents to File Capital Gain ITR Form

Sale of Immovable Property

• Buy and sale agreements, improvement cost details, and transfer costs that display the buy and sale values and improvement costs.

• Property's full address.

• Information on the buyer, such as Aadhaar and PAN.

• Required supporting documentation for claims of exemption under Section 54 or 54EC

Sale of Equity Shares, Mutual Funds, and Virtual Digital Assets

• You can ask your broker for a capital gain statement or tax P&L for the sale of equity shares.

• Consolidated capital gain statements for the sale of mutual funds can be produced using Kfintech and CAMs.

• You can create a transaction report or a profit and loss report from the relevant exchanges for the selling of virtual digital assets.

Other Types of Capital

You must have a document that includes the purchase cost details and the sale consideration for any other forms of money.

Steps to File Income Tax Returns for Capital Gains Online

By following these steps, you can access the income tax department's official online and submit your capital gains ITR:

Step 1: Click on "Income Tax Returns," then select "File Income Tax Returns." Then choose "Income Tax Returns" from "e-File."

Step 2: Choose the assessment year, such as 2024–2025, and choose "Online" as the filing method.

Step 3: After selecting the status, choose the form type (ITR 2). After picking the justification for filing an ITR, click "continue."

Step 4: There are five different kinds of schedules on the following page. After selecting "General," choose "Income Schedule."

Step 5: Choose the appropriate capital asset type from the list by clicking on "Schedule Capital Gains."

Step 6: Click "Add Details" and input the total amount you received from the sale of short-term assets and the acquisition cost for a specific fiscal year if you choose to submit for STCG. For LTCG, however, you must click 'Add' after entering information in Schedule 112A.

Step 7: You must evaluate Part B TTI after verifying the necessary schedules based on LTCG and STCG.

Step 8: After reviewing Part B TTI, if you have any further tax obligations, you will be presented with a "Pay Now" option to pay your taxes.

Step 9: Continue with Select "Preview Return."

Step 10: After reviewing, carry out the validation.

Step 11: You have 30 days to confirm the filed ITR counted from the date of validation and filing. You can use Aadhaar OTP to validate it online, use net banking, or mail a printout of the signed ITR-V (Acknowledgment form) to the Bangalore branch of the IT department.

Conclusion

You now understand the necessary paperwork, how to report long-term capital gains in ITR 2, and much more. You can easily file the ITR for both short-term and long-term capital gains by following the preceding instructions. To prevent errors, make sure you input the right information in the designated fields.

FAQ

Q1. What is the due date for ITR-2 filing for FY 2024-25?

The Income Tax Act's section 139(1) states that the ITR 2 deadline for FY 2024–2025 (AY 2025–2026) is September 15, 2025. For FY 2024–2025, the deadline has been moved to September 15, 2025.

Q2. Are all the schedules in the ITR-2 Form to be filled?

No, you should only choose the schedules that apply to you given your asset holdings and income pattern. If any required information is left blank, the validation error will be displayed at the conclusion.

Q3. Who is not eligible for filing ITR-2?

Individuals or HUFs who receive income from business or professional profits are not eligible to file an ITR-2.

Q4. Can a government employee file an ITR 2?

The application of ITR forms differs according to the taxpayer's income sources, income amount, and taxpayer category (individuals, HUF, companies, etc.). Therefore, whether or not you work for the government is irrelevant.

Q5. I have multiple equity shares and mutual fund transactions. Are all these sales to be filled separately in my ITR form?

You can include the combined sale and buy values in the event of a short-term capital gain, negating the requirement to include transaction-level details. Details must be included on Schedule 112A for each long-term capital gain involving shares or mutual funds acquired prior to January 31, 2018. Consolidated value, however, might be given for shares or MF bought after January 31, 2018, and then sold.

Q6. How can capital gains from MF and stocks be imported to an ITR form?

You must manually enter all of the information on the ITR form, which is now available through the income tax portal. You can, however, file your ITR using TaxBuddy, where your ITR form will be generated immediately and you can easily import the capital gain statement from CAMs, Kfintech, and leading brokerage houses in India.

Q7. What is the processing time for ITR 2?

Depending on the circumstances, the processing period at this automated processing center can range from one month to ten months.

Q8. Who should file ITR-2 for FY 2024-25?

ITR-2 should be filed by individuals or Hindu Undivided Families (HUFs) who have income from capital gains, more than one house property, foreign assets, or income above ₹50 lakh. It is not applicable to those having income from business or profession.

Q9. What qualifies as capital gains for ITR-2 filing?

Capital gains include profits from selling equity shares, mutual funds, property, gold, or other capital assets. Both short-term and long-term capital gains must be reported under ITR-2.

Q10. Can salaried individuals file ITR-2 if they have capital gains?

Yes. Salaried individuals who also earn capital gains (from shares, property, mutual funds, etc.) must file ITR-2 instead of ITR-1 for FY 2024-25.

Q11. What documents are required to file ITR-2 with capital gains?

Key documents include Form 16, Form 26AS, Annual Information Statement (AIS), capital gains statements from brokers or mutual funds, property sale deeds, and purchase-related documents.

Q12. How do I calculate capital gains for ITR-2?

You must calculate capital gains based on the difference between the sale value and indexed cost of acquisition. TaxBuddy and other platforms can auto-calculate these using uploaded statements.

Q13. Is indexation benefit available for all capital gains?

Indexation is allowed only for long-term capital gains on assets like real estate, debt mutual funds, and gold—not for listed equity shares or equity mutual funds.

Q14. Can I report capital losses in ITR-2?

Yes. Capital losses can be reported and carried forward for up to 8 years to offset against future capital gains, provided the ITR is filed within the due date.

Q15. Can I file ITR-2 online without expert help?

Yes. ITR-2 can be filed online either through the Income Tax portal or using e-filing platforms like TaxBuddy, which simplify the process by automating income and capital gains reporting.

Q16. What is the deadline to file ITR-2 for FY 2024-25?

For most individuals, the deadline to file ITR-2 is 31st July 2025 unless extended by the government. For audited cases, the deadline may be later.

Q17. What happens if I file ITR-1 instead of ITR-2 despite having capital gains?

Filing the wrong form may lead to rejection of your return or an income tax notice. If you've already filed ITR-1 incorrectly, you must revise your return using ITR-2 before the revision deadline.