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ITR-4 (Sugam) Filing

ITR-4 (Sugam) is a simplified income tax return form for individuals, HUFs, and partnership firms (excluding LLPs) opting for presumptive taxation under Sections 44AD, 44ADA, or 44AE. It reduces the compliance burden for small businesses and professionals by eliminating the need to maintain detailed books of accounts.

18,000+
Returns Filed
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On-Time Filing
4.8 ★
Client Rating
0
Scheme Lock-Outs
Service Overview

Simple Tax Filing for Small Businesses & Professionals

The presumptive taxation scheme is designed for small businesses, shopkeepers, traders, and certain professionals who prefer to declare a fixed percentage of turnover as income — avoiding the burden of detailed bookkeeping and tax audits. Under Section 44AD, eligible businesses can declare 8% of turnover (6% for digital transactions) as taxable income. Under Section 44ADA, professionals like doctors, lawyers, and CAs can declare 50% of gross receipts as income — without maintaining detailed books.

Critical: Opting into the presumptive scheme (44AD/44ADA) and then showing actual profits below the deemed rate in any year bars you from re-entering the scheme for 5 consecutive years. Plan your regime choice carefully — once you exit, switching back is restricted.

Section 44AD — Small Businesses

8% of turnover = taxable income

Eligible businesses with turnover up to ₹3 crores can declare 8% of total turnover (or 6% for fully digital receipts) as business income — eliminating the need for detailed expense books.

Section 44ADA — Professionals

50% of gross receipts = income

Professionals (doctors, lawyers, CAs, engineers, architects, etc.) with gross receipts up to ₹75 lakhs can declare 50% of gross receipts as professional income under Section 44ADA.

Section 44AE — Transporters

Per-vehicle income declaration

Truck operators and goods transporters owning up to 10 vehicles can declare income per vehicle per month under Section 44AE — a fixed amount per vehicle regardless of actual income.

Other Income Heads

One return for all income

ITR-4 also covers salary income, one house property, and other sources (interest, dividends) — allowing individuals with multiple income types to file a single comprehensive return.

Eligibility Criteria

Who Should File ITR-4?

ITR-4 is for specific taxpayer categories opting for presumptive taxation.

1

Resident Individual / HUF / Firm

ITR-4 is available for resident individuals, Hindu Undivided Families (HUFs), and partnership firms (excluding LLPs) opting for presumptive taxation.

2

Turnover Up to ₹3 Crores (44AD)

Business taxpayers with annual turnover not exceeding ₹3 crores (with cash receipts not exceeding 5% of total) are eligible for Section 44AD presumptive scheme.

3

Professional Receipts Up to ₹75 Lakhs (44ADA)

Specified professionals with gross receipts not exceeding ₹75 lakhs per year can opt for Section 44ADA — if cash receipts don't exceed 5% of total.

4

No Foreign Income / Assets

ITR-4 cannot be used by individuals with foreign income, foreign assets, or income from more than one house property. Such taxpayers must use ITR-3.

Key Benefits

Why the Presumptive Scheme Makes Sense

For small businesses and professionals, presumptive taxation saves time, cost, and compliance burden.

01

No Books Required

Businesses and professionals opting for presumptive taxation are not required to maintain prescribed books of accounts under Section 44AA — significant time and cost savings.

02

No Tax Audit

Presumptive income taxpayers are exempt from mandatory tax audit under Section 44AB as long as turnover/receipts are within prescribed limits.

03

Simple Advance Tax

Businesses under 44AD/44ADA can pay 100% of advance tax in one installment by March 15 — instead of 4 quarterly installments required for regular businesses.

04

Reduced Compliance Cost

No bookkeeping, no audit — just one simple annual return. This dramatically reduces professional fees and administrative time for small business owners.

05

All Income in One Return

ITR-4 covers business, salary, one house property, and other sources — a single return for most common income combinations.

06

Lower Tax for Digital Businesses

Businesses receiving 95%+ payments digitally can declare income at 6% of turnover (instead of 8%) under Section 44AD — incentivizing cashless transactions.

Step-by-Step Process

How We File Your ITR-4

ITR-4 filing is quick when financial data is organized. Our process takes 1–2 days.

Your journey Step 1 of 6

Scroll through the steps — or skip the queue and let our experts handle every one of them for you.

Get Expert Help
1
Step 1 of 6

Confirm Eligibility

Verify that your turnover/receipts are within the presumptive scheme limits and that there are no disqualifying income types.

2
Step 2 of 6

Gather Income Data

Collect bank statements showing total receipts, Form 16 (if any salary), Form 26AS/AIS, and investment proof for deductions.

3
Step 3 of 6

Compute Presumptive Income

Calculate total turnover and compute presumptive income at 6% or 8% (for 44AD) or 50% (for 44ADA). Deduct Chapter VI-A deductions to arrive at taxable income.

4
Step 4 of 6

Prepare ITR-4 Schedules

Fill in Schedules BP (business/professional income), S (salary if any), HP (house property), OS (other sources), and VI-A (deductions).

5
Step 5 of 6

Compute Tax & Verify TDS Credits

Compute total tax liability, apply TDS credits from Form 26AS, and confirm if any balance tax is payable or refund is due.

6
Step 6 of 6

File & E-Verify

Submit ITR-4 on the income tax portal and complete e-verification via Aadhaar OTP within 30 days.

Document Checklist

Documents Required for ITR-4 Filing

Minimal documentation is needed compared to ITR-3 — the key is total turnover/receipts data.

Business & Professional Records

Bank Statements

Business bank account statements showing total receipts for the year — the basis for turnover calculation.

GST Returns

Filed GSTR-1 and GSTR-3B for verifying total taxable turnover.

TDS Certificates (Form 16A)

TDS deducted by clients on professional fee payments.

If you declare income below the presumptive rate (e.g., less than 8% of turnover under 44AD), you must maintain books and undergo a tax audit — even within the turnover limit. Choose carefully.

Post Registration

After Filing ITR-4

Stay on track for the next year's compliance after successful filing.

Within 30 days

E-Verify the Return

Complete e-verification within 30 days. Presumptive taxation returns below ₹5 crores turnover can be verified using Aadhaar OTP.

March 15

Plan Advance Tax for Next Year

Businesses under 44AD/44ADA pay 100% advance tax by March 15 next year. Estimate early to avoid a cash crunch at the year-end.

Before each filing

Evaluate for Continuing Presumptive Scheme

If you opt out of the presumptive scheme in any year, you cannot opt back in for 5 years. Evaluate carefully each year — the cost savings from presumptive taxation are significant.

Why Finace India?

Your Trusted ITR-4 (Sugam) Filing Partner

Show profits below the presumptive rate even once and you're locked out of the scheme for 5 years. We help you plan your regime choice before you're stuck with it.

Presumptive Scheme Planning

We evaluate whether 44AD, 44ADA or 44AE genuinely benefits you before you opt in.

No-Books, No-Audit Filing

Returns prepared without the burden of maintaining detailed books, as the scheme intends.

Lower Tax for Digital Businesses

Reduced presumptive rates for digital receipts identified and applied correctly.

5-Year Lock-Out Protection

We flag years where actual profit may dip below the deemed rate, before you file and trigger the lock-out.

18,000+

Returns Filed

100%

On-Time Filing

4.8 ★

Client Rating

0

Scheme Lock-Outs

4.9 / 5from 2,400+ verified reviews
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FAQ

Frequently Asked Questions

Yes. Doctors, lawyers, CAs, engineers, architects, and management consultants with gross receipts up to ₹75 lakhs can file ITR-4 under Section 44ADA — declaring 50% of receipts as income.
You can declare income below the presumptive rate, but you must then maintain books of accounts and undergo a tax audit if your actual income is below the 44AD/44ADA rates. This defeats the purpose of the presumptive scheme.
Yes. ITR-4 allows house property income/loss declaration for one property — including home loan interest deduction under Section 24(b). This is in addition to the presumptive business income.
For Section 44AD (businesses): ₹3 crores if cash receipts don't exceed 5%. For Section 44ADA (professionals): ₹75 lakhs if cash receipts don't exceed 5%. For 44AE (transporters): up to 10 vehicles owned.
No. If you have capital gains (from shares, property, or other assets), you cannot use ITR-4. You must switch to ITR-3 which covers capital gains in addition to business income.

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