ITR-4 Return

Form ITR 4 is filed by the taxpayers who have opted for the Presumptive Taxation Scheme under Section 44D, 44DA, 44AE of the Income Tax Act,1961. But this is subject to the business turnover limit i.e in case the turnover is exceeding Rs.2 crore then the taxpayer is required to file ITR 3 Form.

 What is Presumptive Taxation in Scheme?

Presumptive Taxation Scheme is a scheme that exempts small taxpayers from maintaining the books of accounts.

Who is Eligible to File Form ITR 4?

Individuals whose income comes from the following sources have to file ITR 4 Form:

  • Business Income under Section 44AD/Section 44AE.
  • Income from a profession as per Section 44ADA.
  • Income up to Rs. 50 lakh from Salary or Pension.


  • Income up to Rs. 50 lakh from One house property (that does not include the brought forward loss o loss that is to be brought forward under this head)
  • Income from other sources up to Rs.50 lakh (does not include winning from lottery or horse races)
  • Form ITR 4 can also be filed by the freelancers if the income is not exceeding Rs.50 lakh.

Presumptive Taxation Scheme

What are the features of the Presumptive Taxation Scheme?

  • Under the presumptive taxation scheme, there is no requirement to maintain the books of accounts
  • The net income is estimated to be 8% of gross cash receipts. However, for payments received via digital mode, the net income is assumed to be 6% of such gross receipts.
  • Deduction of any business expense against this income is not allowed.
  • The business owner has to pay 100% Advance Tax by the 15th of March. There is no need to comply with quarterly instalments of due dates of Advance tax (i.e. in June, Sep, Dec)

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