Who Should File ITR-4?
ITR-4 is designed for small taxpayers opting for Presumptive Taxation Scheme under:
- Section 44AD (Business income)
- Section 44ADA (Professional income)
- Section 44AE (Freight operators)
✅ Eligible Taxpayers
- Individuals
- HUFs (Hindu Undivided Families)
- Partnership Firms (excluding LLPs)
- Professionals with income ≤ ₹50 lakhs
- Businesses with turnover ≤ ₹2 crores (₹3 crores if ≥95% digital transactions)
❌ Who Cannot File ITR-4?
- Companies or LLPs
- Taxpayers with:
- Capital gains
- Multiple house properties
- Foreign income/assets
- Income exceeding ₹50 lakhs (for professionals) or ₹2-3 crores (for businesses)
Key Documents Required
📌 For Presumptive Income:
- Bank statements
- Receipts/payment proofs (if maintaining books)
- GST returns (if registered)
📌 Common Documents:
- Form 16 (if salary income exists)
- Interest certificates (FDs, savings accounts)
- Rent receipts (if applicable)
- Aadhaar-PAN link (mandatory)
Step-by-Step Filing Process
1. Login to Income Tax Portal
Visit incometax.gov.in → Use PAN as User ID.
2. Select ITR-4 for AY 2025-26
Navigate:
e-File → Income Tax Return → File Now → AY 2025-26 → ITR-4 (Sugam)
3. Fill Income Details
- Presumptive Income (Sec 44AD/ADA/AE): Declare 8% (6% for digital receipts) of turnover/receipts.
- Salary/Pension: From Form 16 (if applicable).
- House Property: Only one self-occupied or rented property allowed.
- Other Income: Interest, dividends, etc.
4. Claim Deductions
Enter eligible deductions under:
- Section 80C (PPF, ELSS, etc.)
- Section 80D (Health insurance)
- Other applicable sections
5. Verify Tax Payments
- Match TDS from Form 26AS.
- Check advance tax payments (if made).
6. Submit & E-Verify
Mandatory e-verification via:
- Aadhaar OTP
- Net Banking
- EVC (Electronic Verification Code)
Key Changes for FY 2024-25 (AY 2025-26)
🔹 Higher Presumptive Limits:
- Businesses: ₹3 crore (if ≥95% digital transactions)
- Professionals: ₹75 lakh (proposed)
🔹 Mandatory GST Reconciliation (if GST-registered)
🔹 Stricter Digital Transaction Reporting
🔹 New Tax Regime Default? (Opt-out if choosing old regime)
Filing Deadlines
📅 31st July 2025 (Non-audit cases)
📅 30th September 2025 (Audit cases, if applicable)
⚠️ Late Fees:
- ₹5,000 (if filed by Dec 31, 2025)
- ₹10,000 (if filed later)
- ₹1,000 (if income < ₹5 lakh)
Common Mistakes to Avoid
❌ Not Maintaining Minimum Books (if turnover > ₹10 lakh)
❌ Underreporting Digital Transactions
❌ Mismatch Between GST & Income Tax Filings
❌ Missing E-Verification (Return invalid without it)
Professional Tips
✔ File Early (Avoid last-minute rush)
✔ Reconcile GST Data (If registered)
✔ Maintain Digital Payment Records (For higher presumptive limits)
✔ Consult a CA if turnover crosses ₹2-3 crore
