WHAT IS ITR 4

ITR 4 Form is for presumptive income from Business & Profession as per Section 44AD, Section 44ADA and Section 44AE of the Income Tax Act.

ITR 4 APPLICABLE FOR:

The persons having income from following sources are eligible to file ITR 4:

  • Presumptive income from Business & Profession as per Section 44AD ,Section 44ADA and Section 44AE of the Income Tax Act
  • A small businessman having turnover less than Rs 2 cr. may opt for the scheme u/s 44AD and declare the profits at 8% of gross receipts (6% in case of Digital/Bank receipts)
  • A doctor can opt for presumptive income scheme u/s 44ADA, if his gross receipts do not exceed Rs 50 lakhs and can declare 50% of gross receipts as his income.
  • Persons engaged in the accountancy profession, Interior decoration, Technical consultancy can also for this scheme.
  • Must be a Resident in India.
  • ITR-4 is allowed to an individual, a HUF or a partnership firm. It is not available to a Company.

WHO IS NOT ELIGIBLE TO FILE ITR 4 FORM:

  • LIC Agents (Commission income)
  • Income from commission or brokerage
  • Agency business
  • Any resident having income from any source outside India
  • Claimed relief under Section 90 or 91
  • Earned Speculative income like winning from lotteries, horse races etc.

DUE DATE FOR FILING ITR 4 FORM

 Due date of filing income tax return for FY 2017-18:

  • 31st July 2018 for Individuals ( Audit is not required)
  • 30th September, 2018 for Businesses (Audit is Mandatory)

CHANGES W.E.F. 1ST APRIL, 2018 (ITR 4  FY 2017-18 or AY 2018-2019)

  • Late fee if IT return not filled on time.
  • It is mandatory to disclose the Aadhar number while filing IT Return
  • Reporting additional details under Schedule BP
  • 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
  • The taxpayers now need to provide more details in the form if they are claiming capital gains exemption.
  • New columns have been introduced in the ITR forms to report the details of GST paid and refunded
  • 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.
  • Cess levied on your tax liability has been hiked by 1 per cent from the current 3 per cent to 4 per cent. ( For FY 2018-19)

DETAILS REQUIRED IN ITR 4 FORM

  • General Information
  • Gross total income
  • Deduction and total taxable income
  • Tax computation and tax status
  • Verification & signatures on the return
  • Details of income from Business

WHAT ARE THE DIFFERENT MODE OF FILING ITR 4

  • Online: Through xml file upload
  • Online: Online prepare and file

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.

PENALTY ON LATE FILING OF ITR 

Starting from April 1, if you file your ITR post the deadline of July 31, 2018 (unless the tax department extends it), you will be liable to pay a maximum penalty of Rs.10K.

W.e.f. assessment year 2018-19, if assesse failed to furnish return of income within due date as prescribed under section 139(1) then as per section 234F, he will be required to penalty of:

  • 5000 if return is furnished on or before 31 December of assessment year.
  • 10,000 in any other case.
  • Total income of the person does not exceeds Rs. 5 lakh then Rs. 1000.
  • If Income is not taxable then NIL (Not required to pay penalty as per income tax provisions)

For filing your ITR Return, please send us one liner/ your requirement, our team will get back to you within 24 hrs.

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4 Comments

  1. ABC says:

    If an individual earned consultancy income from April 2017 till June 2017, and then left the country to become an NRI, which ITR form is applicable to him?

    1. UMESH AGRAWAL says:

      Businesses not covered under the presumptive taxation scheme of section 44AD

      The scheme of section 44AD is designed to give relief to small taxpayers engaged in any business, except the following businesses:

      > Business of plying, hiring or leasing of goods carriages referred to in section 44AE.

      > A person who is carrying on any agency business.

      > A person who is earning income in the nature of commission or brokerage

      Apart from above discussed businesses, a person carrying on profession as referred to in section 44AA(1)is not eligible for presumptive taxation scheme.

      An insurance agent cannot adopt the presumptive taxation scheme of section 44AD

      A person who is earning income in the nature of commission or brokerage cannot adopt the presumptive taxation scheme of section 44AD. Insurance agents earn income by way of commission and, hence, they cannot adopt the presumptive taxation scheme of section 44AD.

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