ITR-4 (Business Return)

ITR-4, also known as Sugam Form, is an income tax return form prescribed by the Income Tax Department of India for individuals, Hindu Undivided Families (HUFs), and firms (other than LLPs) who have opted for the presumptive taxation scheme under Section 44AD, Section 44ADA, or Section 44AE of the Income Tax Act. It is suitable for taxpayers with income from business or profession who want to avail the benefits of the presumptive taxation scheme. Here’s an overview of ITR-4:

Eligibility:

• ITR-4 is applicable to individuals, HUFs, and firms (other than LLPs) who have opted for the presumptive taxation scheme under Section 44AD, Section 44ADA, or Section 44AE.
• Taxpayers eligible to file ITR-1, ITR-2, and ITR-3 are not eligible to file ITR-4.

Key Features:

1. Presumptive Taxation Scheme: Taxpayers filing ITR-4 can opt for the presumptive taxation scheme, which allows them to declare their income at a prescribed rate without maintaining detailed books of accounts.
   • Under Section 44AD: Businesses with turnover up to ₹2 crore can declare 8% of their turnover as income.
   • Under Section 44ADA: Professionals such as doctors, engineers, lawyers, etc., can declare 50% of their gross receipts as income.
   • Under Section 44AE: Taxpayers engaged in the business of plying, hiring, or leasing goods carriages can declare income based on the number of vehicles owned.
2. Income Details: Taxpayers need to provide details of income from business or profession, including gross receipts, expenses, and net income as per the presumptive taxation scheme.
3. Other Sources of Income: Apart from income from business or profession, taxpayers can also report income from other sources such as salary, house property, capital gains, and other sources.
4. Deductions: Taxpayers can claim deductions under various sections of the Income Tax Act, such as Section 80C (investment in specified instruments), Section 80D (health insurance premium), Section 80G (donations), etc.
5. Bank Account Details: Taxpayers need to provide details of their bank accounts, including the IFSC code and bank account number, for receiving any refund due.
6. Verification: After filling out the form, taxpayers need to verify it either electronically (using Aadhaar OTP, Net Banking, etc.) or by sending a signed physical copy to the Income Tax Department.

Due Date: The due date for filing ITR-4 for most individuals is usually July 31st of the assessment year. However, it’s advisable to check the latest due date as announced by the Income Tax Department for each financial year.

Filing income tax returns accurately and timely is essential to avoid penalties and comply with tax regulations. Taxpayers should ensure that all relevant income details, deductions, and other information are correctly reported in the ITR-4 form before submission. Additionally, keeping records of supporting documents and maintaining tax compliance throughout the year can facilitate a smooth filing process.