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ITR 4 – Presumptive Business Tax Return Form

Last Update Date : May 03, 2019
Estimated Read Time: 8 min

what is itr 4

As a taxpayer, ITR-4 form is one of the seven ITR forms that you use to file your income tax return. In this article by H&R Block, learn everything you need to know about ITR-4 form.

What is ITR 4?

ITR-4, also known as Sugam, is an Income Tax Return form that is used by the taxpayers who have opted for taxation under presumptive income scheme u/s 44AD, Section 44ADA and Section 44AE of the I-T Act.

Who can file ITR-4?

If you are an individual/ HUF/ partnership firm you can file ITR-4 form. Your income should include:

  • Income from a business u/s 44ADA or 44AE
  • Income from a profession (medical, lawyer, architecture, accountant, technical consultant and interior business) which is calculated u/s 44ADA
  • Salary/pension
  • Income from a house property like rental income
  • Income from other sources like interest income

SIDE NOTE: Freelancers who are involved in the professions mentioned above can also choose this scheme. Although, their gross income should not exceed Rs 50 lakhs.

Who cannot File ITR-4?

SUGAM cannot be used in the following cases:

  • Income from more than one house property or where there is brought forward loss or loss to be carried forward under this head; or
  • Income from winnings from lottery or income from horse races; or
  • Income under the head “capital gains”, e.g. short-term capital gains or long-term capital gains from the sale of house, plot, shares etc.; or
  • Income taxable u/s 115BBDA which includes certain dividends received from domestic companies; or
  • Income u/s 115BBE which includes any income referred to in section 68, section 69, section 69A, section 69B, section 69C or section 69D and reflected in the return of income furnished under section 139; or
  • Agricultural income more than Rs 5,000; or
  • Income from Speculative Business (intraday equity trading) and other special incomes; or
  • Income from an agency business, commission or brokerage; or
  • Person claiming relief of foreign tax paid u/s 90, 90A or 91; or
  • Any resident having any asset (including financial interest in any entity) located outside India or signing authority in any account located outside India; or
  • Any resident having income from any source outside India.

How to File ITR-4?

You can file ITR-4 online as well as offline.

Offline Method

You must fulfil the given criteria to file ITR-4 offline:

  • Your age should be 80 years or above
  • Your income as an Individual should be less than Rs 5 lakh

You can file ITR-4 in the following two ways:

  1. Furnishing the return in a physical form i.e. visiting the Income Tax Department portal and downloading the ITR-4 form, filling in the details manually and sending it to the CPC (Centralized Processing Centre) Bangalore.
  2. Furnishing a bar-coded return which means logging in to the ITD website, filing the form, downloading it and sending.

After filing your return, you will receive your ITR-V (ITR verification) form at your registered address. You must sign this form and send it back to CPC Bangalore. You will be issued an acknowledgement after you submit the verification.

Online Method

Read the following to know the procedure of filing ITR-4 online:

Step 1: Visit the official e-Filing portal (1).

Step 2: File your return with the digital signature.

Step 3: You will receive ITR-V on your registered e-mail id; submit it through bank ATM, Aadhaar OTP, Demat account, etc.

Step 4: You will receive an acknowledgement on your registered email id.

SIDE NOTE: ITR-4 form is an annexure-less return form which means you don’t need to attach any document (including TDS certificate) while you file your ITR for the income tax which is deducted at source.

Verification of ITR-4

Once you have submitted the ITR form, you will be required to verify the return either offline or online.

Online

If you have submitted your ITR-4 form online, you can e- verify your return on the Income Tax Department e-Filing portal (2) . You will receive ITR-V on your registered email id, which you can e-sign and submit.

Offline

If you have furnished your ITR offline, you will receive an ITR-V form at your registered address. Sign the ITR-V and send it to CPC Bangalore.

Filing ITR 4 - Business Income Tax Return

Latest Changes in ITR 4 for AY 2018-19

Changes in ITR 4Details
More details of salary and house property incomeOld 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 ITRA new field has been added where the late filers need to provide the details of late filing fees paid.
Reporting additional details under Schedule BPNow, 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 accountA 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 personA 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 currencyIn 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 DTAAThe 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 gainsThe taxpayers now need to provide more details in the form if they are claiming capital gains exemption.
Reporting remission or cessation of trading liabilityNew forms require separate reporting of remission or cessation of trading liability in case of income from other sources.
Reporting GST payments and refundsNew columns have been introduced in the ITR forms to report the details of GST paid and refunded.
Removal of genderTaxpayers 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.

ITR 4 Form for Whom

Click the image for ITR 4 Download in PDF Format

he 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.

  • Part A: Enter the general information like your name, address, contact details, etc.
  • Part B: Furnish your gross total income which includes income from business and profession, income from other sources, etc.
  • Part C: Fill the details regarding the deduction under various sections like 80C, 80CCD, 80D, 80E, etc. and the total taxable income
  • Part D: Fill the details like rebate on 87A, surcharge, total TCS claimed, etc. for the tax computation and tax status.
  • Verification: Enter your name, place, date and signature.
  • Schedule BP: Fill the details of income from business or profession (Computation of presumptive income u/s 44AD).
  • Schedule AL: Enter the details of asset and liability at the end of the year (applicable in a case where total income exceeds Rs 50 Lakh).
  • Schedule IT: Give the details of advance tax, self-assessment and tax payment.
  • Schedule TCS: Fill in the details of tax collected at source.
  • Schedule TDS1: Enter the details of tax deducted at source from salary.
  • Schedule TDS2: Fill in the details of tax deducted at source on income other than salary.
  • Supplementary schedule TDS1: Fill in the details like TAN number, name of the employer, income under salary and the tax deducted at source.
  • Supplementary schedule TDS2: Fill in the details like deducted year, unique TDS certificate number, name of the deductor, etc.
  • Supplementary schedule IT: Enter the BSR code (Basic Statistical Returns), date of deposit, challan number and the tax paid here.
  • Supplementary schedule TCS: Fill in the details like tax collector account number, name of the collector, total collected, etc.

Major Changes in ITR-2 for AY 2019-20

  1. Residential status: You are now required to give details about your period of stay in India to determine your residential status.
  2. If you are the “Director” of a company, you must provide your PAN and DIN details, along with declaring whether your company shares are listed or not.
  3. If you have invested in unlisted equity shares, you must provide details of the shares and transaction details.
  4. In “Schedule S”, the standard deduction of 40,000 has been added u/s 16(ia).
  5. In “Schedule HP”, there is now an option for “Deemed to be let out” along with “let out” and “self-occupied”.
  6. In “Schedule CG”, under immovable property section, you now must provide the property buyer details such as PAN, percentage of share, and property details such as address and pin code for short term and long-term capital gains.

Presumptive Income Scheme

When your income is calculated based on presumption instead of actual basis, it becomes subject to presumptive income taxation. Presumptive income tax scheme consists of three sections-

  1. Section 44AD
  2. Section 44ADA
  3. Section 44AE

You are eligible to file ITR-4 under the presumptive scheme if you fulfil the eligibility criteria under various section which are given in the table below:

 

 

           Section     Income source        ConditionPresumptive Income
1.       Section 44ADFrom businessGross turnover up to Rs 2 crore annuallyi.                    8% of the turnover

ii.                   6% of the turnover

1.       Section 44ADAFrom professionGross receipts or gross profit up to Rs 50 lakh annually50% of the receipt’s value
2.       Section 44AEFrom goods and transportation businessAssessee owns up to 10 vehicles during the same yearRs 10,000/ 7,500 per vehicle in a month
Not sure how to file your Business Tax Return? Let H&R Block help you file your taxes.

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

People also Ask

Q. How to check if you have e-Filed previous years’ tax returns?

A. Follow the steps given below:

  • Step 1: Visit the Income Tax Department’s website.
  • Step 2: Click on ITR-V receipt status. After this, enter your PAN and the assessment year. Enter the captcha code and submit.

Q. What is the difference between ITR-3 and ITR-4?

A. Form ITR-4is filed by the people who has opted for presumptive income tax scheme like lawyers, doctors, interior designer, etc. Whereas ITR-3 is applicable only if you are an individual/ HUF and earns income from proprietary business or profession.

Q. What is ITR XML file?

A. ITR XML is specifically a file format. It is generated after you have filed the required information of your ITR.

The Income Tax Act, 1961 mandates the citizens to file returns with the Income Tax Department at the end of every financial year. These returns should be filed before the specified due date. We wish you a happy return filing!

How can H&R Block help you?

Tax filing can get really tiring, no matter how many times you have tried filed returns yourself. H&R Block has a team of well qualified and professional tax experts who will file your business income tax returns for you in minimum time and help you reduce your tax liabilities.

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CA Ankita Mathur
Ankita, a Big 4 alumna, is a tax expert at H&R Block (India) with vast experience in managing GST-related business services. An avid traveller, Ankita is a regular contributor to the CAclubindia and loves helping people understand about GST and helping companies be GST compliant.

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