ITR-4 should be filed by taxpayers who are running a business and have opted for presumptive taxation scheme under section 44AD, 44ADA and 44AE of the act. Irrespective of whether they have salary income or not, they can file their returns using form ITR-4.
If the businesses do not opt form presumptive taxation, they can file their returns using Form ITR-3.
Then freelancers such as online content writers, bloggers, vloggers, etc. need to file the ITR-4 form. Also, professionals like chartered accountants, doctors, lawyers and engineers, etc. whose income is computed on a presumptive basis u/s 44AD, 44ADA or 44AE need to file this form.
The Income Tax Department has officially released excel based utility for ITR-1 and ITR-4, marking the start of ITR filing for financial year 2024-25 (AY 2025-26). Now, the taxpayers can proceed filing their returns using the excel utility available on the ‘downloads’ section of the Income Tax portal.
Link to download ITR-1 and ITR-4 excel based utility
Presumptive Sections | Applicable for whom? | Profit Percentage |
Section 44AD | Businesses having turnover within Rs. 2 crores (Rs. 3 crores for digital transactions) | 8% of the turnover (6% for digital transactions) |
Section 44ADA | Specified professions having turnover up to Rs. 50 lakhs (Rs. 75 lakhs for digital transactions) | 50% of the turnover |
Section 44AE | Business of leasing and hiring goods carriages. | Calculated on the basis of whether the vehicle is a heavy vehicle or not, and gross vehicle weight. |
ITR-4 is to be filed by the individuals/HUF/Partnership firm who fulfill the following conditions:
Taxpayers can now report long-term capital gains (LTCG) under section 112A (from listed equity shares and equity-oriented mutual funds) in ITR-1, provided:
Previously, any capital gains required filing ITR-2; this change allows more taxpayers with a very less LTCG to use the simpler ITR-1 form.
ITR-4 is divided into parts as mentioned below:
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
Schedule BP: Details of income from Business-Section 44AD, 44ADA and 44EA
Information regarding turnover/Gross receipts reported for GST: Furnish the GSTIN
Financial Particulars of Business: Mention the asset and liabilities that you own
Schedule IT, TCS and TDS 1: Statement of payment of advance tax and tax on self-assessment, tax collected at source and TDS from salary
Schedule TDS2: Statement of tax deducted at source on income other than salary.
Verification column: Declare that all your information furnished are true to your knowledge and add your signature.
You can submit your ITR-4 Form on ClearTax.
Step 1: Log in or sign up on the ClearTax portal. We’ve added the link to the portal for you in the description below. Login to your account, and let’s get started.
Step 2: If you are filing with us for the first time, you must link your PAN by entering your PAN, Date of Birth, and the OTP received on your registered mobile number. Linking your PAN will allow us to submit your return to the income tax department.
Step 3: But if you filed with us last year and your PAN is already linked, you will directly see this screen.
Step 4: Here, you will have to complete another OTP verification if you want us to pre-fill the details for you. So there are two options here: if you have your Aadhaar registered mobile number with you, you can opt for Aadhaar registered mobile number option and enter the single OTP received as an SMS. And if you don’t have it, then select the IT Department registered mobile number option and enter two OTPs- one received on your mobile and the other one on e-mail.
Step 5: Voila! Most of your information has been auto-filled.
Step 6: Click on 'Continue to e-File’.
Step 7: Here you will see 4 tabs: Personal Info, Income Sources, Tax Saving, and Tax Summary. Let us first look at the personal info tab. All your personal details like name, address and other details will appear here. You can expand each section and review these details. In case you wish to change some information here, you have the option to edit these details.
Step 8: Now let us move to the Income Sources section.
Step 9: Now comes the important section which is the ‘Professional, Freelancing and Business Income’ section. So broadly there are 5 sub-sections here. The first section is 44ADA- this is for professionals. The income tax law has specified a few professions and made it clear that only these professionals can opt for 44ADA:
Professions like
Step 10: Under ‘Nature of Business’ you will have nearly 40 codes. Select the appropriate code - You can just search for your profession if you do not know your code, that's absolutely fine. And mention the trade name and description. If you have multiple professions, you can add them all here.
Note: Your revenue should be less than or equal to Rs 50 lakh and expenses cannot be more than 50% i.e. by default it is assumed that your expenses or cost will not be over 50% of your income.
Step 11: Now let’s look at the 44AD section. 44AD is mainly for small businesses. Just like there were some conditions under 44ADA, there are some conditions for 44AD too. The first condition is that your turnover, i.e. nothing but your sales, must be less than 2 crores and the second condition is that your profit must be more than or equal to 8% of your turnover.
Step 12: Now, it’s time to save some taxes. Go to the tax-savings section and claim all the ‘Deductions’. If you have made donations, tax saving investments like PPF, insurance, ELSS mutual funds, then don't forget to add all those details here. This will help you save some taxes.
Step 13: If you scroll down, you will find the ‘tax-paid’ section. You can upload your Form 26AS to auto-populate the details. All the details of TDS deducted by your clients and also the advance tax you’ve paid, will appear here. If you’ve bought a car or if you’ve gone on a foreign vacation, TCS, i.e. tax may have been collected at source. That also gets filled from 26AS.
Step 14: Now scroll down, and you’ll see the other disclosures tab. If any of these conditions apply to you, then enter those details.
Step 15: Click on ‘Go to next’ and you will see a tax summary. Based on all the details you’ve added, we have auto-selected the ITR Form for you. Note that you can switch between old and new tax regimes only once in a lifetime. So be careful when selecting the tax regime.
Once you are done reviewing all the details in the summary report, click on ‘File Tax’. If you have any tax dues, you can refer to the guide here on ‘how to make the tax payment online’ and complete your tax payment in minutes.
Step 16: Once done, don’t forget to e-verify your return and collect exclusive rewards from over 50+ brands!
Step 1: Go to the Income Tax e-Filing portal.
Step 2: Log in to the e-filing portal by entering your user ID (PAN), Password, and Captcha code and click 'Login'.
Step 3: Click on the 'e-File' menu and click the 'Income Tax Return' link.
Step 4: Click on ‘Continue’.
Step 5: Read the instructions carefully and fill in all the applicable and mandatory fields of the online ITR form.
Step 6: Choose the appropriate Verification option in the 'Taxes Paid and Verification' tab.
Step 7: Choose any one of the following options to verify the income tax return:
Step 8: Click on the 'Preview and Submit' button, Verify all the data entered in the ITR.
Step 9: 'Submit' the ITR.
Step 10: On Choosing the 'I would like to e-Verify' option, e-Verification should be done through any of the available methods by entering the EVC/OTP.
Below changes are incorporated in the ITR-4 form from AY 2024-25 onwards:
Also read about:
Which ITR Should I File
How to file ITR Online
How to file ITR-1 (SAHAJ) Online
What is ITR 2 Form & How to File ITR-2
What is ITR 3 Form & How to File ITR-3
What is ITR-5 Form, Structure & How to File ITR 5
ITR 6
How to File and Download ITR-7 Form
ITR 3 vs ITR 4
ITR 1 vs ITR 4
How to File ITR-2 for Income from Capital Gains FY 2022-23
I'm a chartered accountant, well-versed in the ins and outs of income tax, GST, and keeping the books balanced. Numbers are my thing, I can sift through financial statements and tax codes with the best of them. But there's another side to me – a side that thrives on words, not figures. Read more