The old ITR-4S tax form has been renamed ITR-4. This page contains information on filing ITR-4 for FY 2016-17 (AY 2017-18)

If you’ve e-filed an ITR-4 for FY 2015-16, then you must file an ITR-3 now. Learn more about ITR-3 return form.

 

Contents:

What is the ITR 4 for AY 2017-18?

The ITR-4 Form is the Income Tax Return form for those taxpayers who have opted for the presumptive income scheme as per Section 44AD ,Sec 44ADA and Section 44AE of the Income Tax Act. However, if the turnover of the business mentioned above exceeds Rs 2 crores, the tax payer will have to file ITR-3.

 

itr 4

 

Click here to download ITR-4 for Assessment Year 2017-18
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What is the Structure of ITR 4 for AY 2017-18?

ITR-4S is divided into:

  • Part A: General Information
  • Part B: Gross total income from the five heads of income
  • Part C: Deduction and total taxable income
  • Part D: Tax computation and tax status
  • Verification & signatures on the return

Schedule BP – Details of income from Business.

Financial Particulars of the Business

  • Schedule AL :Asset and liability at the end of year(applicable in case where total income exceeds Rs 50 lakhs)
  • Schedule IT: Statement of payment of advance-tax and tax on self-assessment.
  • Schedule-TCS: Statement of tax collected at source.
  • Schedule TDS1: Statement of tax deducted at source on salary.
  • Schedule TDS2: Statement of tax deducted at source on income other than salary.
  • Supplementary schedule TDS1
  • Supplementary schedule TDS2
  • Supplementary schedule IT
  • Supplementary schedule TCS

How do I file my ITR-4 Form for AY 2017-18?

You can submit your ITR-4 Form either online or offline.

Offline:

The ITR form can be filed offline only in any of the following case:

  1. Individual is of the age of 80 years or more.
  2. The income of the individual is less than Rs 5lakhs and who do not have to claim refund in the income tax return

The return can be filed offline :

  • By furnishing a return in a physical paper form
  • By furnishing a bar-coded return

The Income Tax Department will issue you an acknowledgment at the time of submission of your physical paper return.

Online/Electronically:

  • By furnishing the return electronically under digital signature
  • By transmitting the data electronically and then submitting the verification of the return in Return Form ITR-V

If you submit your ITR-4 Form electronically under digital signature, the acknowledgment will be sent to your registered email id. You can also choose to download it manually from the income tax website. You are then required to sign it and send it to the Income Tax Department’s CPC office in Bangalore within 120 days of e-filing.

Remember that ITR-4 is an annexure-less form i.e. you do not have to attach any documents when you send it. 

FAQs

Who can file ITR 4 ?

ITR 4 can be filed by all those who opt for presumptive income for instance

  1. a small businessman having turnover less than Rs 2crore may opt for the scheme u/s 44AD and declare the profits at 8% of gross receipts(6% in case of digital receipts) .To know more ,click here
  2. A doctor can opt for presumptive income scheme u/s 44ADA if his gross receipts donot exceed Rs 50 lakhs and can declare 50% of gross receipts as his income.To know more ,click here
  3. An engineer can also opt for this scheme.
  4. Film Artists
  5. Persons engaged in the accountancy profession,Interior decoration,Technical consultacy can also for this scheme.To know more ,click here

Freelancers engaged in the above profession can also opt for this scheme if their gross receipts donot exceed Rs 50 lakhs.

Presumptive Income & its Taxation – under section 44AD

When you are running a small business, you may not have enough resources to maintain proper accounting information and calculate your profit or loss. This makes it difficult to keep track of your income from such a business and find out how much tax you need to pay.

With this in mind the Income Tax Department has laid out some simple provisions where your income is assumed based on the gross receipts of your business. This method is called the presumptive method, where tax is paid on an estimated basis.

Features of this Scheme

  • Your Net Income is estimated to be 8% of the gross receipts of your business. But From FY 2016-17 onwards, if gross receipts are received through digital mode of payments ,then Net Income is estimated at 6% of such gross receipts and for cash receipts ,rate is same at 8% of such cash receipts.
  • You don’t have to maintain books of accounts of this business.
  • You have to pay 100% Advance Tax by 15th March for such a business. No need to comply with requirement of quarterly installments due dates (June,sep,Dec) of advance tax.
  • You are not allowed to deduct any business expenses against the income.

If you are running more than 1 business, the scheme has to be chosen for each business. For example, if you run 3 businesses where only 1 is assessed under section 44AD. The relief of not maintaining accounting records & no requirement of audit is only applicable to the business to which this scheme applies. For other 2 businesses which are not covered under this section – the accounting records have to be made and audit is also required.

Similarly, in case of Advance Tax, the benefit of paying the advance tax in one installment by 15th March  is only granted for the business for which this scheme has been opted for. If the tax payer has income which is other than from such business, where his tax liability exceeds Rs 10,000 in a year, he has to pay advance tax on such other income.

The scheme cannot be adopted by the taxpayer, if he has claimed deduction under section 10, 10A, 10B, Section 10BA, or Section 80HH to 80RRB in the relevant year.

Eligibility Criteria for this Scheme

To be eligible for this scheme:

  • Your gross receipts or turnover of the business for which you want to avail this scheme should be less than Rs 2 crore.
  • You must be a Resident in India.
  • This scheme is allowed to an individual, a HUF or a partnership firm. It is not available to a Company.

Not sure which ITR form you need to use? Read our guide for help.

Eligible Businesses : The taxpayer may be in any business – retail trading or wholesale trading or civil construction or any other business to avail this scheme. But this method of income computation is NOT applicable to:

  • Income from commission or brokerage
  • Agency business
  • Business of plying, hiring or leasing goods carriage (see section 44AE)
  • Professionals – who are carrying on profession of legal, medical, engineering, architectural, accountancy, technical consultancy, interior decoration, an authorized representative, film artist, company secretary and information technology. Authorized representative means – any person, who represents someone, for a fee or remuneration, before any Tribunal or authority under law. Film Artist includes a producer, actor, cameraman, director, music director, art director, dance director, editor, singer, lyricist, story writer, screenplay writer, dialogue writer, dress designer – basically any person who is involved in his professional capacity in the production of a film.(see Sec 44ADA)

These are the professions listed under section 44AA(1).

Devesh runs a medical shop in his colony. The receipts of his business are Rs 1,50,00,000 in financial year 2016-17. Can Devesh take benefit of the scheme under section 44AD?

Devesh is a resident and his receipts from this business are less than Rs 2 crore. His business is not listed under the non-eligible businesses list and therefore he can avail this scheme under section 44AD.

Deduction for Business Expenses : No business expenses are allowed to be deducted from the net income. Depreciation is also not deductible. However, in case of a partnership firm, separate deduction for remuneration of partners and interest paid to partners is allowed. This must be within the limit specified under section 40(b).

Even though depreciation is not allowed as a deduction written down value (WDV) of the assets shall be considered as if depreciation has been allowed.

Rohit runs a kiryana shop and his gross receipts are Rs 75,12,260 from this business. He decided to opt for the scheme under section 44AD. He also wants to claim depreciation for 1 large refrigerators and a computer with billing system he purchased for Rs 2,50,500. He also spent Rs 1,50,000 buying new racks for displaying his goods.

Since Rohit has opted for the presumptive scheme under section 44AD, his net income is computed as 8%(assuming all cash receipts) of Rs 75,12,260 = Rs 6,00,981. Under this scheme no deductions are allowed from income. Rohit will not be allowed to deduct depreciation from this income. He cannot deduct expenses for purchase of the new rack.

Can the taxpayer declare higher or lower income than 8% of gross receipts? 

The taxpayer can voluntarily declare a higher income and pay tax on it. In case the taxpayer chooses to declare lower income than 8% of gross receipts – he shall have to maintain books of accounts and get them audited.

Click here to read more about bookkeeping and audit requirements.

Ritesh runs a stationary shop and his turnover from this business are Rs 85,20,000. He wants to opt for the scheme under section 44AD and therefore his income shall be Rs 6,81,600 (at 8% of gross receipts,assuming all cash receipts). However Ritesh’s actual income from the business works out to Rs 5,74,000. Ritesh decides to not opt for the scheme under section 44AD and pay tax on the actual income of his business. However, since he’s not opting for this scheme he has to maintain proper accounting records and also get his records audited.

Computing Turnover or Gross Receipts : Gross receipts or Turnover mean the total collections of the business. The receipts shall be inclusive of VAT & Excise Duty. The receipts shall also include delivery charges as well as receipts from sale of scrap.

Discounts given, advances received and money received on sale of assets should be excluded.

Presumptive Income in case of taxpayers engaged in business of plying, leasing or hiring of trucks (under Section 44AE)

For those who are in the business of plying, leasing or hiring of trucks a scheme similar to presumptive income scheme under section 44D is available.

Features of this scheme

  • Net Income from a heavy goods vehicle (including any goods carriage) will be assumed as Rs 7,500 per month for each vehicle beginning assessment year 2015-16.
  • You don’t have to maintain books of accounts of this business.
  • You have to pay 100% Advance Tax by 15th March for such a business. No need to comply with requirement of quarterly instalments due dates (June,sep,Dec) of advance tax.
  • You are not allowed to deduct any business expenses against the income.

Here ‘Goods carriage’ means any vehicle used only for the carriage of goods. ‘Heavy goods vehicle’ means a goods carriage whose standalone weight (without loading goods) is more than 12,000 kgs.

Part of a month shall be rounded off to the next month. For example if a goods carriage is owned for 9 months and 3 days, the net income shall be calculated as if the carriage was owned for 10 months.

The relief of not maintaining accounting records & no requirement of audit is only applicable to the business to which this scheme applies. For any other businesses which are not covered under this section – the accounting records have to be made and audit is also required.

In case the taxpayer chooses to declare lower income than above, he shall have to maintain books of accounts and get them audited.

Eligibility Criteria : To avail this scheme

  • You should be in the business of plying, leasing or hiring trucks.
  • You should not own more than 10 goods carriages at any time during the year. Include carriages taken on hire purchase or on installments.
  • You may be an individual, HUF, Company or partnership firm – scheme is allowed to all taxpayers.

Deduction for Business Expenses: No business expenses are allowed to be deducted from the net income. Depreciation is also not deductible. However, in case of a partnership firm, separate deduction for remuneration of partners and interest paid to partners is allowed. This must be within the limit specified under section 40(b).

Even though depreciation is not allowed as a deduction written down value (WDV) of the assets shall be considered as if depreciation has been allowed.

Rohan is engaged in the business of plying, hiring or leasing goods carriages, and owns 5 trucks and another 2 trucks which have been taken on installments. Rohan wants to know what will be his income from this business.

Rohan can opt for the scheme under section 44AE since he earns less than 10 trucks. He owns 7 trucks in total, include trucks which have been purchased on installments even if some installments are unpaid. Rohan’s income from this business shall be Rs 7 trucks x Rs 7,500 x 12 months = Rs 6,30,000 shall be Rohan’s net income from this business. No business expenses can be claimed from this income.

Can the taxpayer declare higher or lower income?: The taxpayer can voluntarily declare a higher income and pay tax on it. In case the taxpayer chooses to declare lower income than as mentioned above – he shall have to maintain books of accounts and get them audited.

Presumptive Income in case of Professionals (under Section 44ADA)

The benefit of Presumptive tax rates were only available to Businesses. But now this benefit has been extended to professionals also .It will be applicable to the Professionals whose total gross receipts does not exceed Rs 50 lakhs in a financial year.

Presumptive Tax Rate: The income of the professionals opting for this scheme would be assumed at 50% of the total Gross receipts for the year.

Applicability of the scheme: The Persons engaged in the following profession can opt for this presumptive Income scheme:

  1. Medical
  2. Engineering
  3. Legal
  4. Architectural Profession
  5. Accountancy Profession
  6. Technical Consultancy
  7. Interior Decoration
  8. Other Notified Professionals
  • Authorized representatives
  • Film Artists
  • Certain Sports related person
  • Company Secretaries
  • Information Technology

The scheme is applicable only to a resident assesse who is an individual, HUF or Partnership but not LLP (Limited Liability Partnership Firm).

No requirement of Maintenance of books of Account: Professionals opting for this scheme need not maintain books of account required to be kept under sec 44AA and also he need not get the books of account get audited under sec 44AB.

Deduction for Business Expenses: No business expenses are allowed to be deducted from the net income. Depreciation is also not deductible. Even though depreciation is not allowed as a deduction written down value (WDV) of the assets shall be considered as if depreciation has been allowed.

Can the taxpayer declare higher or lower income? The taxpayer can voluntarily declare a higher income and pay tax on it. In case the taxpayer chooses to declare lower income than as mentioned above – he shall have to maintain books of accounts and get them audited.

If you are looking to file ITR 4 for AY 2016-17(FY 2015-16) ,then continue reading below

What is the ITR-4 Form for AY 2016-17?

The ITR-4 Form is applicable for individuals or HUFs who have income from proprietary business or are carrying on a profession.

If the requirements of audit are applicable, the due date of filing of return is 30th September. Otherwise, usually the due date of filing of return for non-audit cases is 31st July.

In case the presumptive method of taxation is applicable (Section 44AD and Section 44AE of the Income Tax Act), ITR-4S can be filed.

Since ITR-4S is applicable where gross receipts/turnover is less than Rs 1crore; assesses who are carrying out business or profession under presumptive income as per section 44AD & 44AE of the Income Tax Act but have turnover/gross receipts of more than Rs. 1 crore; will have to file ITR-4.

Click here to get the latest ITR-4 form from the Income Tax Department.

itr4

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Who is eligible to file using the ITR-4 Form for AY 2016-17?

Assesses who are eligible to file using the ITR-4 Form are:

  • Carrying on a business or profession
  • Eligible for Presumptive Business Income but where Turnover/Gross Receipts exceeds Rs. 1 crore
  • Return may include Salary/Pension
  • Earn Income from House Property
  • Earn Income from Other Sources

Not sure which ITR form you need to use? Read our guide for help.

Are you a Freelancer and need help with filing out your ITR-4?

Read our guide to income taxes for Freelancers. The tax experts can prepare and file your return.

Freelancers Guide

What is the structure of the ITR-4 Form for AY 2016-17?

ITR-4 is divided into:

  • Part A
    • Part A-GEN: General information and Nature of Business
    • Part A-BS: Balance Sheet as of March 31, 2015 of the Proprietary Business or Profession
    • Part A-P&L: Profit and Loss for the Financial Year 2014-15
    • Part A-OI: Other Information (optional in a case not liable for audit under Section 44AB)
    • Part A-QD: Quantitative Details (optional in a case not liable for audit under Section 44AB)
  • Part B: Outline of the total income and tax computation in respect of income chargeable total tax.
  • Verification

After this there are 35 schedules.

  • Schedule-S: Computation of income under the head Salaries.
  • Schedule-HP: Computation of income under the head Income from House Property
  • Schedule-DPM: Computation of depreciation on plant and machinery under the Income-tax Act
  • Schedule DOA: Computation of depreciation on other assets under the Income-tax Act
  • Schedule DEP: Summary of depreciation on all the assets under the Income-tax Act
  • Schedule DCG: Computation of deemed capital gains on sale of depreciable assets
  • Schedule ESR: Deduction under section 35 (expenditure on scientific research)
  • Schedule-CG: Computation of income under the head Capital gains.
  • Schedule-OS: Computation of income under the head Income from other sources.
  • Schedule-CYLA: Statement of income after set off of current year’s losses
  • Schedule BFLA: Statement of income after set off of unabsorbed loss brought forward from earlier years.
  • Schedule CFL: Statement of losses to be carried forward to future years.
  • Schedule- UD: Statement of unabsorbed depreciation.
  • Schedule- 10A: Computation of deduction under section 10A.
  • Schedule- 10AA: Computation of deduction under section 10AA.
  • Schedule- 10B: Computation of deduction under section 10B.
  • Schedule- 10BA: Computation of deduction under section 10BA.
  • Schedule 80G: Statement of donations entitled for deduction under section 80G.
  • Schedule- 80IA: Computation of deduction under section 80IA.
  • Schedule- 80IB: Computation of deduction under section 80IB.
  • Schedule- 80IC/ 80-IE: Computation of deduction under section 80IC/ 80-IE.
  • Schedule VIA: Statement of deductions (from total income) under Chapter VIA.
  • Schedule SPI: Statement of income arising to spouse/ minor child/ son’s wife or any other person or association of persons to be included in the income of assesse in Schedules-HP, BP, CG and OS.
  • Schedule SI: Statement of income which is chargeable to tax at special rates
  • Schedule-IF: Information regarding partnership firms in which assessee is a partner.
  • Schedule EI: Statement of Income not included in total income (exempt incomes)
  • Schedule IT: Statement of payment of advance-tax and tax on self-assessment.
  • Schedule TDS1: Statement of tax deducted at source on salary.
  • Schedule TDS2: Statement of tax deducted at source on income other than salary.
  • Schedule-TCS: Statement of tax collected at source.
  • Schedule TR: Statement of tax relief claimed under section 90 or section 90A or section 91.
  • Schedule FA: Statement of Foreign Assets.

Do you need to file ITR-4?

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How do I fill out the ITR-4 Form for AY 2016-17?

Here are a few general guidelines to keep in mind while filling your ITR-4 form:

  • If any schedule is not applicable to you, strike it out and write —NA— across it
  • If any item is not applicable to you, write NA against it
  • Indicate nil figures by “Nil”
  • Put a “-” sign before negative figures
  • All figures are to be rounded off to the nearest one rupee except figures for total income/loss and tax payable. Those are to be rounded off to the nearest multiple of ten.
  • If you are an individual, under the Employer Category you should tick Government if you are a Central/State Government employee. You should tick PSU if you work in a public sector company of the Central/State Government.

What is the best sequence to fill it out?

The easiest way to fill out your ITR-4 Form is to follow this sequence:

  • Part A
  • All the schedules
  • Part B
  • Verification

How do I file my ITR-4 Form for AY 2016-17?

You can submit your ITR-4 Form either online or offline. It is mandatory to file Income Tax Returns electronically (either through Mode 3 or Mode 4) for the following assesses:

  • those who earn more than Rs. 5 lakhs per year
  • those having any assets outside India (including financial interest in any entity) or signing authority in any account outside India
  • those claiming relief under Section 90/90A/91 to whom Schedule FSI and Schedule TR apply

Offline:

  • By furnishing a return in a physical paper form
  • By furnishing a bar-coded return

The Income Tax Department will issue you an acknowledgment at the time of submission of your physical paper return.

Online/Electronically:

  • By furnishing the return electronically under digital signature
  • By transmitting the data electronically and then submitting the verification of the return in Return Form ITR-V

If you submit your ITR-4 Form electronically under digital signature, the acknowledgment will be sent to your registered email id. You can also choose to download it manually from the income tax website. You are then required to sign it and send it to the Income Tax Department’s CPC office in Bangalore within 120 days of e-filing.

Remember that ITR-4 is an annexure-less form i.e. you do not have to attach any documents when you send it.

How do you send your ITR-V to the CPC Office?

We have a guide to help you print and send your ITR-V to the CPC office.

Read our Guide

Frequently Asked Questions

What is the difference between ITR-4 and ITR-4S?

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