ITR FORM-4
The ITR-4 Form, also known as the Sugam form, caters specifically to taxpayers who participate in the presumptive income scheme detailed in Sections 44AD, 44ADA, and 44AE of the Income Tax Act. Completion and submission of this form are obligatory for eligible taxpayers.
For businesses with an annual turnover surpassing Rs. 2 Crores, ITR-3 is mandatory. Furthermore, depending on individual circumstances, ITR-5 might also be necessary. Prayog Enterprise provides expert guidance for filing income tax returns using the ITR-4 form. It's tailored for individuals, Hindu Undivided Families (HUFs), and firms (excluding Limited Liability Partnerships or LLPs) who opt for the presumptive income scheme outlined in Sections 44AD, 44ADA, and 44AE of the Income Tax Act.
Presumptive Taxation scheme
Presumptive taxation is a simplified method of calculating and paying taxes, primarily aimed at small businesses and professionals. Instead of maintaining detailed books of accounts and calculating income based on actual profits and expenses, taxpayers under the presumptive taxation scheme are allowed to declare their income at a predetermined rate.
In India, the presumptive income scheme is outlined in Sections 44AD, 44ADA, and 44AE of the Income Tax Act. Here's a brief explanation of each:
Section 44AD: This section applies to businesses (other than specified professions) with a turnover of up to Rs. 2 Crores. Under this scheme, taxpayers can declare their income at 8% of the total turnover or gross receipts, and they are not required to maintain detailed books of accounts.
Section 44ADA: Designed for professionals such as doctors, lawyers, architects, engineers, etc., with gross receipts up to Rs. 50 lakhs in a financial year. Professionals under this scheme can declare their income at 50% of the gross receipts, and similar to Section 44AD, they are relieved from maintaining detailed books of accounts.
Section 44AE: This section applies to taxpayers engaged in the business of plying, hiring, or leasing goods carriages. Under this scheme, taxpayers can declare their income based on a presumptive rate per vehicle per month, irrespective of the actual income earned. It provides relief from the requirement of maintaining records related to the vehicle.
Presumptive taxation simplifies the tax compliance process for small taxpayers, reducing the burden of maintaining extensive records and facilitating easier calculation and payment of taxes. It's important for taxpayers to understand the eligibility criteria, benefits, and implications of opting for presumptive taxation before choosing this scheme for their business or profession.
Understanding the Sections of ITR-4 Form for Seamless Filing
To ensure seamless filing of the ITR-4 form, it's crucial to understand the various sections and their significance. Here's a breakdown of the key sections of the ITR-3 form:
Part A - General Information: This section requires basic information such as name, address, PAN (Permanent Account Number), and contact details of the taxpayer.
Part B - Gross Total Income: Here, you'll provide details of income under different heads such as salary, house property, business or profession, capital gains, and other sources. It's essential to accurately report all sources of income.
Part C - Deductions and Taxable Total Income: This section deals with deductions allowed under various sections of the Income Tax Act, such as Section 80C, 80D, 80G, etc. Deductions help reduce the taxable income, so it's important to claim all eligible deductions.
Part D - Computation of Tax Payable: This part involves calculating the total tax liability based on the taxable income after deductions. It includes computation of tax on income at the applicable slab rates and any applicable surcharge and cess.
Part E - Other Information: Here, you'll provide additional details such as details of advance tax and self-assessment tax payments made during the financial year.
Part F - Schedule FSI: This section is for providing details of income from outside India, including foreign assets and foreign income, if applicable.
Part G - Schedule TR: If you have tax relief claimed under sections 90, 90A, or 91, you'll provide details in this section.
Part H - Schedule FA: This section is applicable if you have income from a source outside India and need to furnish details of foreign assets and income.
Verification: The taxpayer needs to sign and verify the accuracy of the information provided in the form.
Understanding these sections will help you accurately fill out the ITR-3 form and ensure seamless filing. It's advisable to gather all necessary documents and information before starting the filing process to avoid any errors or omissions. Additionally, seeking assistance from a tax professional or using online filing platforms can further streamline the process and ensure compliance with tax laws.
Penalty for the ITR-4 Filing
The penalty for late filing of the ITR-4 form, or any income tax return for that matter, can be significant and can vary depending on several factors, If you file your ITR after the due date specified by the Income Tax Department, you may be liable to pay a late filing fee. As of my last update, the late filing fee for individuals whose total income does not exceed Rs. 5 lakhs is Rs. 1,000, and for others, it's Rs. 10,000. This fee is applicable for filing returns after the due date but before December 31 of the assessment year.
If you have any tax liability and fail to pay it before the due date, you will be liable to pay interest on the outstanding tax amount. The interest rate is typically specified by the Income Tax Department and is applicable from the due date of filing the return until the actual date of payment.
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Why Prayog Enterprise to file ITR
Expert Guidance: Prayog Enterprise offers expert assistance to ensure accurate filing of your ITR-4 income tax return. Our team of tax professionals guides you through the selection of the appropriate form based on your income sources, ensuring compliance with tax regulations.
Error-Free Filing: We meticulously calculate your tax liability and conduct thorough error checks to minimize the risk of penalties or tax notices. Our proactive approach prioritizes timely filing, giving you peace of mind during the tax season.
Efficient Refund Processing: If eligible, Prayog Enterprise assists in processing your income tax refund efficiently, ensuring you receive the refunds you are entitled to without delay.
Responsive Support: Our dedicated team of tax experts is readily available to address your queries and provide personalized guidance throughout the filing process. We are committed to delivering exceptional customer service and ensuring a smooth experience for our clients.
Up-to-Date Compliance: Prayog Enterprise keeps you informed about tax law changes and deadlines, ensuring that you remain compliant with the latest regulations. We strive to empower our clients with the knowledge they need to make informed financial decisions.
Secure Platform: With Prayog Enterprise, you can trust that your financial data is secure. Our robust platform employs advanced security measures to safeguard your information, providing you with peace of mind while simplifying your ITR-4 filing experience.