Overview

• Salary or pension
• Income from one house property (no brought-forward loss)
• Other income such as bank interest or family pension
• Agricultural income up to ₹5,000

You should not file ITR-1 if you

• Have capital gains (shares, mutual funds, property, crypto, etc.)
• Have business or professional income
• Own more than one house property
• Are a non-resident or RNOR
• Have foreign income or foreign assets
• Are a director in a company or hold unlisted shares

Eligibility Criteria for ITR-1

• You are a Resident Individual
• Total income does not exceed ₹50 lakh
• Income is limited to salary, one house property, and other income
• Agricultural income is ₹5,000 or less

Income Covered Under ITR-1

• Salary or pension income
• Income or loss from one house property
• Interest from savings accounts, fixed deposits, and recurring deposits
• Family pension

Section 87A Rebate – 2026 Explanation

How the rebate actually works (New Regime)

• Tax is first calculated using slabs
• Then, a rebate under Section 87A is applied
• If taxable income does not exceed ₹12,00,000,
• the entire calculated tax is rebated,
• final tax payable becomes Nil

Key points to understand:

• ₹12 lakh is not a zero-tax slab
• Nil tax is achieved through rebate, not slab exemption
• If taxable income exceeds ₹12 lakh, the rebate is not available

Why salaried individuals hear “₹12.75 lakh is tax-free”

• Standard deduction for salary = ₹75,000
• Gross salary of ₹12,75,000
• Less standard deduction ₹75,000
• Taxable income = ₹12,00,000
• Section 87A rebate applies → Nil tax payable