ITR-4 Filing (Presumptive) – ITR + Financial Statements

ITR-4, also known as Sugam Form, is an income tax return form for individuals and Hindu Undivided Families (HUFs) with income from a presumptive business or profession. This means that their income is determined based on a fixed percentage of their gross receipts or turnover, rather than maintaining detailed accounting records.

Who Can File ITR-4?

ITR-4 is eligible for individuals and HUFs who meet the following criteria:

• Income sources: The primary income should come from a presumptive business or profession under Section 44AD, Section 44ADA, or Section 44AE of the Income Tax Act.

• Total income: The total income from all sources should not exceed Rs 50 lakhs.

• Business or profession: The business or profession must fall under the presumptive taxation scheme.

• Foreign income/assets: Individuals with foreign income or assets can file ITR-4.

• Resident status: The individual must be a resident of India for the entire financial year.

Benefits of Filing ITR-4

ITR-4 offers several advantages for eligible individuals and HUFs, including:

• Simplified form: ITR-4 is a one-page form, making it easier to understand and fill out compared to other ITR forms.

• No annexures: Unlike other ITR forms, ITR-4 does not require any annexures or attachments, reducing the paperwork burden.

• Presumptive income: The presumptive income scheme simplifies the calculation of business income, eliminating the need for detailed accounting records.

• Online filing: ITR-4 can be conveniently filed electronically through the Income Tax Department's e-filing portal.

• Pre-filled information: The e-filing portal provides pre-filled information, such as salary and tax deducted at source (TDS) details, simplifying the filing process.

Documents Required for ITR-4

The following documents are typically required for filing ITR-4:

• Business registration documents (if applicable)

• Rent receipts for business premises (if applicable)

• Salary paid to partners (if applicable)

• Interest on borrowed capital for business (if applicable)

• Investment proofs for capital gains (if applicable)

• Details of foreign income or assets (if applicable)

• Copy of PAN card

• Aadhaar card copy

• Bank account details for tax refund

Additional Considerations

• Presumptive income calculation: Ensure you correctly calculate the presumptive income based on the applicable percentage and turnover or gross receipts.

• Audit: If the turnover exceeds Rs 2 crore, an audit may be required.

• Tax planning: It is advisable to consult with a Chartered Accountant (CA) for tax planning and guidance, especially if your tax situation is complex or involves deductions and expenses beyond the presumptive income scheme.

• Due date: The due date for filing ITR-4 for the financial year 2022-23 is July 31st, 2023.

• Penalties for late filing: Failure to file ITR-4 by the due date can result in penalties.