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Filing of ITR 4 Form


Form ITR-4 Filing Sections 44D, 44DA, and 44AE of the Income Tax Act of 1961 require taxpayers who chose the Presumptive Taxation Scheme to complete Form ITR-4. However, this is contingent on the business's annual turnover cap, which is Rs. 2 crore. In that instance, the taxpayer must file Form ITR 3.


What does Scheme's alleged taxation mean?

Small taxpayers are excluded from keeping books of accounts under a practise known as presumptive taxation.


Who may submit a Form ITR 4?


People must submit Form ITR-4 if their income is from one of the sources listed below:

  • Under Sections 44AD and 44AE, business income is taxed.

  • Earning capacity as defined by Section 44ADA.

  • A salary or pension that is up to Rs. 50 lakh.

  • From a single-house property, you can earn up to Rs. 50 lakh (that does not include the brought forward loss of loss that is to be brought forward under this head)

  • Up to Rs. 50 lakh in other income (does not include winning from lottery or horse races)

  • If the income does not exceed Rs. 50 lakh, independent contractors can also file Form ITR 4.

Who is not qualified to receive an ITR-4 Form?


ITR-4 paperwork is required from the following people:

  • Possesses a directorship in a corporation

  • At any  moment during the previous year, held any unlisted equity interests.

  • Has  resources or a financial stake in a company outside of India

  • Possesses the right to sign on any accounts outside of India

  • Has income from an outside of India source

  • Has revenue from a business or profession that is exempt from the computation requirements of Sections 44AD, 44ADA, or 44AE, such as commission, brokerage, or income from a speculative enterprise.

  • Yields capital gains

  • Has earnings from multiple properties, including homes

  • Has revenue from winning the lottery, horse racing, or income taxed at a special rate under Sections 115BBDA or 115BBE that falls into the category of "other sources"

  • Possess revenue that needs to be divided up in accordance with Section 5A's rules

  • More than 5,000 Indian rupees from agriculture

  • A loss under "revenue from other sources" has been brought forward or is one that needs to be carried over under any income head.

  • Possesses a claim for relief under Section 90, 90A, or 91

  • Exists a Section 57 deduction claim? (except deduction relating to family pension)

  • Has a tax credit claim in the possession of a different person that was withheld at the source

  • Co-owns a home with another person (inserted in AY 20-21).


ITR 4 Form components


The following is Form ITR-4's structure:

  • General Information in Part A

  • Part B: The gross total of the five sources of income

  • Schedule of Deductions and Total Taxable Income, Part C BP: Details of Business Income Schedule 80G: Specifics of Donations Eligible for Section 80G Deduction

  • Schedule IT: Self-assessment tax and advance tax payment statement Schedule

  • TCS: Tax collected at source statement Statement of Tax Deducted at Source on

  • Salary Schedule (TDS1) Statement of Tax Deducted at Source on Income Other Than Salary Schedule (TDS2)

  • Verification Plan.


Possibility of Taxation


The Presumptive Taxation Scheme has what characteristics?

  • Maintaining the books of accounts is not necessary under the presumptive taxation system.

  • 8% of the total cash receipts are expected to represent the net income. The net income, however, is estimated to be 6% of such gross receipts for payments made in digital form.

  • Nothing in this income may be deducted for any business-related expenses.

  • By March 15th, the company owner must pay 100% of the advance tax. The quarterly Advance Tax Payment Due Dates do not have to be observed (i.e. in June, Sep, Dec)


Possibility of Taxation


Modest entrepreneurs

  • Section 44AD of the Internal Revenue Code is applicable.

  • The taxpayer may operate any eligible business, including wholesale distribution, retail sales, trading, civil construction, or any other type of enterprise.

  • Up to Rs 2 crore in annual turnover is the maximum.

  • Calculation: 6% of gross annual revenue will be levied for electronic receipts and 8% of all receipts overall.


Professional Income 

  • Tax Section - Section 44ADA

  • Law firms are a permitted business.

  • Interior decorating technical consultation

  • Construction and engineering

  • Medical

  • The annual collections cap is Rs. 50 lakh as the maximum turnover.

  • 50% of gross sales is calculated. One may declare a larger income if it exceeds 50%.



  • Section 44AE of the Transporters' Applicable Income Tax Act

  • Businesses that hire operate, or lease goods carriages are considered eligible businesses.

  • Having a maximum annual turnover restriction of no more than 10 goods vehicles.

  • 7,500 per car, per month, or a portion thereof, computed based on the length of time the person held the vehicle during the year.

  • Allowable deductions - Additional exemptions and deductions are not permitted (A partnership can claim deduction and interest to the partners from the computed income at RS. 7500 vehicle per month)


How to submit an ITR 4 form


ITR-4 applications can be submitted offline or online.


  • The aforementioned people may submit offline forms:

  • Individuals who are 80 years or older

  • The person does not need to claim a refund in the income tax return because his income is less than Rs. 5 lakh.

  • You can submit ITR 4 offline:

  • Providing a return in actual paper form

  • Through submission of a bar-coded return (An acknowledgment will be issued at the time of submission of the physical paper return)



  • Through the use of a digital signature while submitting the return electronically.

  • Through electronic data transmission, followed by the submission of the Form ITR-verification V's of the return.

  • An acknowledgment will be sent to the provided email address if the ITR-4 Form is signed digitally.



ITR 4 Form in AY 2021–2022 saw significant changes.


The ITR 3 Form now reflects the following changes:

In contrast to the adjustments made the previous year, the ITR 4 Form has not undergone any significant alterations.

A statement to select between the old and new tax regimes has been added to the ITR 4 Form for the AY 2021–2022 (see below). "Are you deciding to use the new tax system under Section 115 BAC, where the tax payer must select either "Yes" or "No"?" states the statement. Part A general information contains this declaration. The Form 101E's furnishing date and acknowledgment number must be filed if the answer is yes.


Part B - In the e-filing utility, select the type of income under "Income from other sources" from a drop-down menu that includes options for interest from savings accounts, deposits, etc. The quarterly breakdown must be provided in the case of dividend income in order to allow the appropriate relief from the charge of interest for failure to pay advance tax in accordance with section 234C.


ITR-4 Return Filing Requirements: 

  • Bank Statement

  • PAN Card Information about the person's PAN card.

  • Aadhar Card The authorised signatory's Aadhar card


FAQs on Filing ITR-4 Returns


1. Does the balance sheet have to be included with ITR 4 filings?

The specifics of the balance sheet need not be disclosed in the case of ITR 4.


2. What is the ITR 4 cash in hand?

The ITR4 does not require the disclosure of personal assets. In ITR 4, only assets held for commercial purposes should be listed. Regarding various creditors, inventors, and cash on hand, you can display Nil (Zero) value. There won't be a validation error, therefore returns can be submitted.


3. Is the ITR 1 to ITR 4 conversion possible?

Form ITR 1 can be changed into Form ITR 4, yes.


4. In ITR 4, what is inventory?

The assets that a business holds in anticipation of future sales are its inventories, which comprise finished goods, work-in-progress, and raw materials. Additionally, it comprises the products that are bought and kept for resale, maintenance supplies, and consumables used during the production process.


5. Can I switch from an ITR 3 to an ITR 4?

Without the sales being disclosed, switching from ITR 3 to ITR 4 is not possible.


6. Can physicians submit ITR 4?

Yes, physicians who choose the presumed scheme are still allowed to file Form ITR 4 and declare profits that exceed 50% of receipts. But if the receipts are less than Rs. 50 lakh and the expenses are less than 50% of the receipts, then choosing the scheme will result in a sizable savings.

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