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ITR 4 – Presumptive Business Tax Return Form

Last Update Date : August 11, 2018

what is itr 4

Latest Update: The CBDT has renamed the old ITR 4S to ITR-4 (Sugam). The ITR-4 that was used earlier (FY 2015-16) is now replaced with ITR 3.

Filing your IT returns is just as important as paying your taxes and choosing the right ITR form is just as essential for that matter. ITR-4 form is one of the seven ITR forms that the taxpayers have to choose to file their taxes. ITR-4 form is to be filed by a certain group of people. So before determining which ITR for you should file, it is always wise to check your eligibility to file the form.

In this guide, we will be discussing ITR 4 form and how it should be filed.

What is ITR 4?

ITR 4 is an Income Tax Return form that is used by the taxpayers who have opted for taxation under presumptive income scheme under Section 44AD, Section 44ADA and Section 44AE of the IT Act. However, a taxpayer will have to file ITR 3, if the annual turnover of his business exceeds Rs 2 crores.

ITR 4 Form for Whom

Click the image for ITR 4 Download in PDF Format

How to File ITR 4 Form with the Income Tax Department?

This ITR-4 Return Form can be filed with the Income-tax Department in any of the following ways–

  • by furnishing the return in a paper form;
  • by furnishing the return electronically under digital signature;
  • by transmitting the data in the return electronically under electronic verification code;
  • by transmitting the data in the return electronically and thereafter submitting the verification of the return in Return Form ITR – V;

NOTE: Where the Return Form is furnished in the manner mentioned at 6 (iv), the assessee should printout two copies of Form ITR – V. One copy of ITR-V, duly signed by the assessee, has to be sent by post to – Post Bag No. 1, Electronic City Office, Bengaluru— 560500, Karnataka. The other copy may be retained by the assessee for his record.

Who can File ITR-4 Physically?

Only the following persons have an option to file return in paper form:-

  • an individual of the age of 80 years or more at any time during the previous year; or
  • an individual or HUF whose income does not exceed five lakh rupees and no refund is claimed in the return of income. In case of a Firm, option to file return in paper form is not applicable.

How to File ITR 4 with H&R Block India?

Filing Income Tax Return with H&R Block is a simple 4 steps process:

  • Provide your basic details and we will call back within 24 hours
  • Upload or Email your tax documents to the tax expert and complete the payment process
  • Get your return prepared and filed with maximum deductions and tax savings

Filing ITR 4 - Business Income Tax Return

ITR 4 is for Whom?

This Return Form is to be used by an individual / HUF / Partnership Firm whose total income for the assessment year 2018-19 includes:-

  • Business income where such income is computed in accordance with special provisions referred to in sections 44AD and 44AE of the Act for computation of business income; or
  • Income from Profession where such income is computed in accordance with special provisions referred to in sections 44ADA; or
  • Salary / Pension; or
  • Income from One House Property (excluding cases where there is brought forward loss or loss to be carried forward under this head); or
  • Income from Other Sources (excluding Winning from Lottery and Income from Race Horses).

Note 1: The income computed shall be presumed to have been computed after giving full effect to every loss, allowance, depreciation or deduction under the Income Tax Act.

Note 2: Further, in a case where the income of another person like spouse, minor child, etc. is to be clubbed with the income of the assessee, this Return Form can be used only if the income being clubbed falls into the above income categories.

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Who is not eligible to file ITR 4?

SUGAM cannot be used in following cases:-

  1. Income from more than one house property or where there is brought forward loss or loss to be carried forward under this head; or
  2. Income from Winnings from lottery or income from Race horses; or
  3. Income under the head “Capital Gains”, e.g. Short-term capital gains or long-term capital gains from sale of house, plot, shares etc.; or
  4. Income taxable under section 115BBDA; or
  5. Income of the nature referred to in section 115BBE; or
  6. Agricultural income in excess of ₹5,000; or
  7. Income from Speculative Business and other special incomes; or
  8. Income from an agency business or income in the nature of commission or brokerage; or
  9. Person claiming relief of foreign tax paid under section 90, 90A or 91; or
  10. Any resident having any asset (including financial interest in any entity) located outside India or signing authority in any account located outside India; or
  11. Any resident having income from any source outside India.

[ Read: Which ITR to File? ]

For whom is SUGAM Form not Mandatory

SUGAM ITR Form shall not apply at the option of the assessee, if:-

  • the assessee keeps and maintains all the books of account and other documents referred to in section 44AA in respect of the business or profession;
  • the assessee gets his accounts audited and obtains a report of such audit as required under section 44AB in respect of the business or profession. In the above scenarios, regular ITR 3 or ITR 5, as the case may, should be filed and not SUGAM.

 

SUGAM is Annexure-less Return Form

No document (including TDS Certificate) should be attached to the ITR-4 Return Form. All such documents enclosed with this Return Form will be detached and returned to the person filing the return.

Latest Changes in ITR 4 for AY 2018-19

Changes in ITR 4 Details
More details of salary and house property income Old ITR form required the taxpayers to report only the taxable amount but the new ITR forms require you to report detailed calculation of income from salary and house property.
Penalty for late filing of ITR A new field has been added where the late filers need to provide the details of late filing fees paid.
Reporting additional details under Schedule BP Now, there is an additional requirement to quote GSTR No. and turnover / gross receipts as per GST return filed under Schedule BP of the form in respect of details of business and profession computed on presumptive basis u/s 44 AD or 44AE or 44ADA.
Credit of refund to foreign bank account A field has been added where an NRI taxpayer can provide the details of a foreign bank account in which he wants the credit of the tax refund he wants to claim.
Claiming credit of TDS deducted in the name of another person A new field has been added to facilitate the claim for TDS credit where the TDS was deducted in the name of another person or from a common pool or other similar situations.
Breakup of payments or receipts in foreign currency In the old form, a taxpayer was required to provide only limited details in the section “FINANCIAL PARTICULARS OF THE BUSINESS”, but now he needs to furnish the whole balance sheet in condensed form.
Claiming relief under DTAA The form now asks the taxpayer claiming relief as per DTAA to report more details like rate as per treaty, rate as per I-T Act and applicable rate etc.
Claiming exemption on capital gains The taxpayers now need to provide more details in the form if they are claiming capital gains exemption.
Reporting remission or cessation of trading liability New forms require separate reporting of remission or cessation of trading liability in case of income from other sources.
Reporting GST payments and refunds New columns have been introduced in the ITR forms to report the details of GST paid and refunded.
Removal of gender Taxpayers now do not need to mention their gender in the form.

All these changes have been made by the tax department in the ITR form are aimed at making the assessment procedure online. Therefore, we can see that the department is seeking more and more information from the taxpayers to facilitate e-assessment.

How to Fill ITR 4?

The form should be filled up as per the sequence mentioned below:

  • Part A
  • Schedules
  • Part B
  • Verification
  • Details relating to TRP and counter signature of TRP if return is prepared by him.

ITR 4 form is divided into several parts, namely Part A, B, C and D followed by verification and signatures section.

Form ITR-4 has the following components:

Part A-GEN: In this section, you are asked to provide your personal information, filing status and audit information.
Nature of Business: This section asks you to provide details of your business or profession.
Part A – BS and Part A – P & L: Here you are required to furnish details of your balance sheet and P & L statement of your proprietary business or profession.
Part A – OI and Part A – QD: These parts are optional in case they are not liable for audit.
Part (B) TI and TTI: Here you are asked to compute and fill your total income as well as taxable income.

Bank Account: Details of all bank accounts held in India at any time during the previous year are filled here.
Verification: You are asked to fill and sign verification statement here.
TRP: If your tax return has been prepared by a Tax Return Preparer then you should provide its details in this section.
Tax Payments: You should fill the details of Advance tax and Self-Assessment tax paid by you. You are also required to provide details of TDS on salary, TDS on other income, TCS on income.

After this, you are required to fill schedules (pages S1-S20) to the return form as applicable.

Schedule-S: Computation of income under the head salaries
Schedule-HP: Computation of income under the head income from house property
Schedule BP: Computation of income from business or profession
Schedule-DPM: Computation of depreciation on plant and machinery under the Income Tax Act
Schedule DOA: Computation of depreciation on other assets under the Income Tax Act
Schedule DEP: Summary of depreciation on all the assets under the Income Tax Act
Schedule DCG: Computation of deemed capital gains on sale of depreciable assets
Schedule ESR: Deduction under section 35 (expenditure on scientific research)
Schedule-CG: Computation of income under the head Capital gains
Schedule-OS: Computation of income under the head Income from other sources.
Schedule-CYLA: Statement of income after set off of current year’s losses
Schedule BFLA: Statement of income after set off of unabsorbed loss brought forward from earlier years.
Schedule CFL: Statement of losses to be carried forward to future years
Schedule UD: Statement of unabsorbed depreciation
Schedule ICDS: Effect of income computation disclosure standards on profit
Schedule- 10A: Computation of deduction under section 10A
Schedule- 10AA: Computation of deduction under section 10AA
Schedule 80G: Statement of donations entitled for deduction under section 80G
Schedule- 80-IA: Computation of deduction under section 80IA
Schedule- 80-IB: Computation of deduction under section 80IB
Schedule- 80IC/ 80-IE: Computation of deduction under section 80IC/ 80-IE
Schedule VI-A: Statement of deductions (from total income) under Chapter VIA
Schedule AMT: Computation of alternate minimum tax payable u/s 115JC
Schedule AMTC: Computation of tax credit u/s 115JD
Schedule SPI:Statement of income arising to spouse/ minor child/ son’s wife or any other person or association of persons to be included in the income of assessee in schedules HP, BP, CG and OS
Schedule SI: Statement of income which is chargeable to tax at special rates
Schedule IF: Information regarding partnership firms in which assessee is a partner
Schedule EI: Statement of Income not included in total income (exempt incomes)
Schedule PTI: Pass through income details from business trust or investment fund as per section 115UA, 115UB
Schedule FSI: Details of income from outside India and tax relief
Schedule TR: Statement of tax relief claimed under section 90 or section 90A or section 91
Schedule FA: Statement of foreign assets
Schedule 5A: Information regarding apportionment of income between spouses governed by Portuguese Civil Code
Schedule AL: Asset and liability at the end of the year (other than those included in Part A-BS) (Application in a case where total income exceeds Rs. 50 lakh.

How H&R Block helps you?

Tax filing can get really tiring, no matter how many times you have tried filed returns yourself. H&R Block India has a team of well qualified and professional tax experts who will file your business income tax returns for you in minimum time and also help you reduce your tax liabilities. If you haven’t filed your tax return yet, get in touch with us for effective measures. Happy hassle-free tax filing to you!

Not sure how to file your Business Tax Return? Let H&R Block help you file your taxes.
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