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ITR-4 (Sugam): A Simple Guide for Businesses and Professionals – Who Should File and How to Do It Hassle-Free

Tired of complicated tax returns? For many small businesses and professionals, ITR-4 (Sugam) offers a breath of fresh air. It's a simplified tax return form designed to ease your compliance burden. At Filingworld.in, we understand the need for simplicity. Let's demystify this form and see if it's the right fit for you.

What is ITR-4 (Sugam)?

ITR-4, also known as Sugam, is specifically designed for individuals, Hindu Undivided Families (HUFs), and partnership firms (excluding Limited Liability Partnerships or LLPs) who have opted for the presumptive taxation scheme under Sections 44AD, 44ADA, or 44AE of the Income Tax Act. This scheme allows eligible taxpayers to declare income at a prescribed rate, eliminating the need to maintain detailed books of accounts.

Who Can Opt for ITR-4 (Sugam)?

You can choose ITR-4 Sugam if you are a resident individual, HUF, or a partnership firm (not LLP) and have:

  • Business income under Section 44AD (for businesses with turnover up to Rs. 3 Crore, with specific conditions for online transactions).
  • Professional income under Section 44ADA (for specified professionals with gross receipts up to Rs. 75 Lakh).
  • Income from plying, hiring, or leasing goods carriages under Section 44AE.
  • Salary or pension income up to Rs. 50 Lakh.
  • Income from One House Property (excluding cases where loss is brought forward or carried forward).
  • Income from Other Sources (excluding winning from lottery, race horses etc.).
  • Your total income does not exceed Rs. 50 Lakh.

Who Cannot Opt for ITR-4 (Sugam)?

While ITR-4 is super convenient, it's not for everyone. You cannot file ITR-4 if you:

  • Are a company or an LLP.
  • Are a Non-Resident Indian (NRI) or Not Ordinarily Resident (NOR).
  • Have income from capital gains, more than one house property, or agricultural income exceeding Rs. 5,000.
  • Have income from lottery, race horses, or other specific sources.
  • Have carried forward loss or loss to be carried forward from previous years.
  • Are a director in a company or hold unlisted equity shares.
  • Have an aggregate income exceeding Rs. 50 Lakh.
  • Are required to maintain detailed books of accounts as per Section 44AA.

How to File ITR-4 (Sugam)?

Filing ITR-4 is straightforward. You can file it:

  1. Online: Log in to the Income Tax e-filing portal (incometax.gov.in), navigate to 'e-File' > 'Income Tax Returns' > 'File Income Tax Return', select the Assessment Year, and choose 'ITR-4'. Fill in the details directly.
  2. Offline Utility: Download the offline utility (JSON format) from the e-filing portal, fill in your details, generate the JSON file, and then upload it to the portal.

After filling in all required information, including personal details, business/professional income, deductions, and taxes paid, you must verify your return. The easiest way is via Aadhaar OTP or Net Banking (e-verification).

Key Things to Remember

ITR-4 Sugam is a fantastic option for eligible taxpayers seeking a straightforward filing process. Remember to declare your income truthfully and meet the filing deadlines to avoid penalties. Even though presumptive taxation simplifies things, ensure all your details are accurate. If you're still unsure about your eligibility or need assistance, don't hesitate to seek expert advice. Filingworld.in is always here to simplify your tax journey!

FAQs
The primary benefit is the reduction of compliance burden. You are not required to maintain detailed books of accounts or get them audited, which saves a lot of time and money.
The tax rates are based on your total taxable income and the tax regime you choose (old vs. new). The presumptive scheme only helps you compute your gross income; the final tax is calculated based on the standard tax slabs.
No. Under the presumptive scheme, you cannot claim any separate business expenses like rent, electricity, or depreciation. The fixed percentage you declare as income is considered your net profit after all expenses.
The due date for filing ITR-4 is typically July 31st of the assessment year. However, it's always wise to check the Income Tax Department's website for any extensions.