ITR Form IV

ITR FORM -IV

The current Income-tax Return (ITR) Form-4 is to be filed by small business owners, who do not maintain books of accounts but only maintain sales ledger in approximate volume. This includes online sellers, traders, wholesalers and manufacturers, etc.

Then freelancers such as online content writers, bloggers, vloggers, etc. need to file ITR-4 Form. Also, professionals like chartered accountants, doctors, lawyers and engineers, etc. need to file this form.

Individuals who are drawing a salary as well as earning additional income from freelancing activities or part-time business also need to file ITR-4 Form. Furthermore, individuals who make profits through Futures and Options (F&O), cryptocurrency, commodities, or forex need to file this particular form.

ITR Form IV

ITR-4 Form is the Income Tax Return form for the taxpayers who opt for a presumptive income scheme under Section 44AD, Section 44ADA and Section 44AE of the Income Tax Act.

However, if the turnover of the business mentioned above exceeds Rs 2 crores, the taxpayer will have to file ITR-3.

Who is required to file ITR-4?

ITR 4 is to be filed by the individuals/HUF/ Partnership firm whose total income of AY 2020-21 includes as below:

• Business income under section 44AD or 44AE
• Income from profession calculated under section 44ADA
• Salary/pension having income up to Rs 50 lakh
• Income from One House Property having income up to Rs 50 lakh (excluding the brought forward loss or loss to be carried forward cases under this head)
• Income from Other Sources having income up to Rs 50 lakh (Excluding winning from lottery and income from horse races).

Who is not required to file ITR-4 for AY 2022-23?

• An individual having income from salary, house property or other sources above Rs 50 lakh cannot use this form.
• An individual who is either a director in a company and has invested in unlisted equity shares cannot use this form.
• An individual, HUF or partnership firm whose books of accounts should be audited under the Income Tax Act, 1961.
• Resident but not ordinarily residents  (RNOR)
• Non-residents
• In case an individual is either a director in a company or has invested in unlisted equity shares
• Deferred tax on ESOP received from employer being an eligible start‐up
• Having an agricultural income of more than Rs 5,000

Structure of ITR 4

ITR-4 is divided into parts as mentioned below:

Part A: General Information

Part B: Gross Total Income From the Five Heads of Income

Part C: Deductions & Total taxable Income

Part D: Tax Computation and Tax Status

Schedule BP: Details of Income from Business – Section 44AD, 44ADA and 44EA

Information Regarding turnover/Gross Receipts Reported for GST

Financial Particulars of Business

Schedule IT, TCS and TDS 1: Statement of Payment of Advance tax and tax on self-assessment, Tax, collected at Source and TDS From Salary.

Schedule TDS2 : Statement of Tax Deducted at Sources on Income Other Than Salary

Verification Column

Download ITR-4

The following are the key changes introduced in the ITR-4 Form for the assessment year (AY) 2022-23:

• As a taxpayer, you need to disclose whether you had opted for the new tax regime under Section 115BAC, and also if Form No. 10-IE was filed in FY 2020-21. Further, you can choose to opt, not opt, to continue, or even opt out of the new tax regime for FY 2021-22
• In case a resident individual has income tax deferred on an employee stock ownership plan (ESOP), they are restricted to file ITR‐4 Form
• A quarterly breakup of dividend income is required to be provided
• Schedule DI, which was inserted for AY 2020-21, has been removed