Presumptive Taxation Scheme or Income Tax Return for Small Businesses
Who is required to file ITR-4 or Income Tax Return for Small Business?
ITR-4 is to be filed by an Individual or Hindu Undivided Family (HUF). Further, this individual can be either Resident or Resident other than Not Ordinarily Resident or a Firm (other than LLP) having income from any of the following sources:
Who cannot file form ITR-4?
ITR-4 or Income Tax Return for Small Businesses cannot be used by a person who –
(a) is a Director in a Company, or
(b) has held any unlisted equity shares at any time during the previous year, or
(c) has any asset (including financial interest in any entity) located outside India, or
(d) signing authority in any account located outside India, or
(e) has income from any source outside India, or
(f) In addition, is a person in whose case payment or deduction of tax has been deferred on ESOP.
Get your ITR filed by TaxHelpdesk Experts!
You have to first select service of Income Tax Return for small taxpayers. Thereafter, you have to make payment and upload the documents. On uploading documents, there will be an assignment of Tax Expert. Consequently, the tax expert will review your documents. Accordingly, there will be the processing of your order. Further, you can check the status of your order in your respective account.
Income Tax Slabs applicable on Income of Individuals are:
1. The rates of Surcharge, Marginal Relief and SHE Cess are same. Moreover, they are same under both the tax regimes and shall be levied, where applicable.
2. Rebate under Section 87-A: Resident Individual whose total income is not more than ₹ 5,00,000 are eligible for a rebate of 100% of income tax or ₹ 12,500, whichever is less. In addition, this rebate is also available in both tax regimes
which Individuals can get benefit?
The individual can claim Income Tax benefit on Income from House Property on interest paid on housing loan & housing improvement loan. In addition, in case of self- occupied property, the upper limit for deduction of interest paid on housing loan is ₹2 lakh. However, this deduction is not available for person opting for New Tax Regime.
Income Tax Deductions available to Individuals
Deduction in respect of life insurance premia, deferred annuity, contributions to provident fund, etc
Annuity plan of LIC or another insurer towards Pension Scheme
Pension Scheme of Central Government
Investment in National Pension Scheme
Deduction towards payments made to Health Insurance Premium & Preventive Health check up
₹25,000 / ₹50,000
Deduction wrt medical treatment, etc.
₹40,000 / ₹1,00,000
Deduction in respect of maintenance including medical treatment of a dependent who is a person with disability
₹75,000 / ₹1,25,000
Deduction towards interest payments made on loan for higher education of self or relative
Total amount paid towards interest on loan taken
Deduction towards interest payments made on loan taken for acquisition of residential house property
₹50,000 / ₹1,50,000
Deduction towards interest payments made on loan for purchase of Electric Vehicle
Deduction towards Donations made to certain Funds, Charitable Institutions, etc.
Deduction towards rent paid for house & applicable only where HRA is not part of Salary
Least of the following:
Deduction towards Donations made for Scientific Research or Rural Development
Deduction towards Donations made to Political Party
Any amount other than cash
Deduction on interest received on saving bank accounts by Non-Senior Citizens
Deduction on interest received on deposits by Resident Senior Citizens
Deductions for an individual with Disability
₹75,000 / ₹1,25,000
Steps involved in filing of ITR-4
Documents required for filing of ITR-4
Due dates for filing returns of income/loss
Individuals whose accounts are not to be audited
31st July of the assessment year
Individuals whose accounts are to be audited
31st October of the assessment year
As compared to previous years, ITR-4 or Income Tax Return for Small Businesses from AY 2021-22 has an option of choosing new tax regime. Moreover, if you wish to opt for the new tax regime u/s 115BAC, you need to select Yes in the new form.
Please note that individual or HUF opting for new tax regime u/s 115BAC has to mandatorily file Form 10-IE. In addition, the filing of this form should be before due date of filing of return u/s 139(1). Moreover, after filing Form 10-IE, an original return or revised return is required to be filed mandatorily to avail the benefit of new tax slab u/s 115BAC and Acknowledgement. Further, the number and date of filing Form 10IE are mandatory fields in ITR-4.
No. You can opt for the presumptive taxation scheme of section 44AD. Moreover, it is only if the total turnover or gross receipts from your business do not exceed the limit prescribed (i.e., ₹ 2 Crore).
The presumptive taxation scheme of Section 44ADA can be adopted by a resident in India. In addition, if gross receipts of the specified profession do not exceed ₹ 50 Lakh in a FY. Accordingly, the following professions are specified professions:
- Engineering or Architectural
- Technical Consultancy
- Interior Decoration
- In addition, any other Profession as notified by CBDT