ITR-4 (Sugam) A.Y.2023-24: ITR-4 (Sugam), also known as the Income Tax Return Form 4, is a tax filing form for individuals, Hindu Undivided Families (HUFs), and firms (excluding Limited Liability Partnerships) who have income from business or profession. ITR-4 is especially for individuals/HUF/Firms whose total income does not exceed ₹50 lakh and who have income from business or profession computed on a presumptive basis under sections 44AD, 44ADA, or 44AE. It also allows the inclusion of income from salary/pension, one house property, agricultural income up to ₹5,000, and other sources such as interest income, family pension, and more. However, certain individuals, such as non-resident Indians, directors of companies, and those with income exceeding ₹50 lakh, among others, are not eligible to file ITR-4.
Table of contents
- Quick Summary for ITR-4 A.Y.2023-24
- What is ITR?
- What is ITR-4?
- Changes in ITR4 A.Y.2023-24
- Who Can Use ITR-4?
- Wo Can Not Use ITR-4?
- Procedure to File ITR-4 Online or Offline
- Procedure to ITR-4 Online A.Y. 2023-24
- Documents Required to File ITR-4 (Sugam) for A.Y. 2023-24
- Changes in ITR-4 for A.Y. 2023-24
- Pre-Requisites for Online Filing of ITR-4
- Due Dates to File ITR-4 A.Y.2023-24
- Structure of ITR-4 A.Y.2023-24
Quick Summary for ITR-4 A.Y.2023-24
|Form Name||ITR-4 (Sugam)|
|A.Y. (Assessment Year)||2023-24|
|Eligible Taxpayers||Individuals, Hindu Undivided Families (HUFs), and firms (excluding Limited Liability Partnerships)|
|Income Criteria||Total income should not exceed ₹50 lakh|
|Presumptive Basis||Income from business or profession computed on a presumptive basis under sections 44AD, 44ADA, or 44AE|
|Inclusions||Income from salary/pension, one house property, agricultural income up to ₹5,000, and other sources such as interest income, family pension, etc.|
|Exclusions||Non-resident Indians, directors of companies, individuals with income exceeding ₹50 lakh, etc.|
|Changes in ITR-4 A.Y.2023-24||1. Reporting of Crypto and Virtual Digital Assets
2. Intraday Trading Reporting
3. Opting Out of New Tax Regime
4. Changes in Balance Sheet Reporting
5. SEBI Registration Number for FIIs/FPIs
|Eligible Taxpayers for ITR-4||1. Resident Individuals
2. Hindu Undivided Families (HUFs)
3. Firms (Other than LLP)
|Ineligible Taxpayers for ITR-4||1. RNOR and NRIs
2. Total Income Exceeding ₹50 Lakh
3. Agricultural Income above ₹5,000
4. Directors in a Company
5. Income from More Than One House Property
6. Income of a Specific Nature, etc.
|Filing Procedures||Online Filing or Partially Online and Partially Offline Filing|
|Documents Required||PAN, Aadhaar Number, Bank Account Details, Form 16, Form 26AS, Bank Statements, House Property Documents, Investment and Expense Documents, Business and Profession Details, Other Income Details, Aadhaar OTP|
|Changes in ITR-4 A.Y. 2023-24||No significant changes compared to previous years|
What is ITR?
ITR is also known as Income Tax Return Forms. There are multiple ITR forms available for filing income tax returns in India. The specific form to be used depends on the type of taxpayer, nature of income, and other applicable criteria.
ITR-1 (SAHAJ): For individuals having income from salary, one house property, other sources (excluding winning from lottery and income from race horses), and total income up to ₹50 lakh.
ITR-2: For individuals and HUFs (Hindu Undivided Families) not having income from business or profession, and who are not eligible to file ITR-1.
ITR-3: For individuals and HUFs having income from business or profession as a partner in a firm and not eligible to file ITR-4.
ITR-4 (SUGAM): For individuals, HUFs, and firms (other than LLP) having income from business or profession computed on a presumptive basis under sections 44AD, 44ADA, or 44AE.
ITR-5: For persons other than individuals, HUFs, companies, and those filing ITR-7.
ITR-6: For companies other than companies claiming exemption under section 11 (exempt income).
ITR-7: For persons including companies required to furnish return under sections 139(4A), 139(4B), 139(4C), or 139(4D) (for charitable trusts, political parties, research associations, news agencies, and institutions).
In this article, we will discuss ITR-4.
What is ITR-4?
ITR-4, also known as “SUGAM,” is an Income Tax Return form in India. It is primarily designed for individuals, Hindu Undivided Families (HUFs), and firms (other than Limited Liability Partnerships) who have income from business or profession computed on a presumptive basis. The ITR-4 form is filed under the provisions of sections 44AD, 44ADA, or 44AE of the Income Tax Act, 1961.
Changes in ITR4 A.Y.2023-24
Here are the changes in ITR-4 for AY 2023-24 .
1. Reporting of Crypto and Virtual Digital Assets: The new ITR-4 form includes a separate schedule to report income from crypto and other virtual digital assets transactions. You will need to provide details of each transaction, including sale and purchase dates.
2. Intraday Trading Reporting: If you are engaged in intraday trading, you are now required to report your turnover and income under the new “Trading Account” section.
3. Opting Out of New Tax Regime: The form includes additional questions to determine if you had opted out of the new tax regime in previous years.
4. Changes in Balance Sheet Reporting: Advances received from individuals specified in Section 40A(2)(b) and others should be reported under the “Advances” section in the Source of Funds.
5. SEBI Registration Number for FIIs/FPIs: Foreign institutional investors (FIIs/FPIs) must provide their SEBI registration number as an additional disclosure measure.
Who Can Use ITR-4?
ITR-4, also known as “SUGAM,” can be used by the following types of taxpayers in India:
1. Resident Individuals: Individuals who are residents of India for the relevant financial year can use ITR-4.
2. Hindu Undivided Families (HUFs): HUFs having income from business or profession computed on a presumptive basis under sections 44AD, 44ADA, or 44AE are eligible to file ITR-4.
3. Firms (Other than LLP): Partnership firms that are not Limited Liability Partnerships (LLPs) and have income from business or profession computed on a presumptive basis can use ITR-4.
It’s important to note that ITR-4 is applicable when the taxpayer’s income meets certain criteria, such as:
a) Income Limit: The total income of the taxpayer should not exceed ₹50 lakh during the financial year.
b) Presumptive Basis: The income from business or profession should be computed on a presumptive basis under sections 44AD, 44ADA, or 44AE of the Income Tax Act, 1961.
Additionally, taxpayers using ITR-4 should have income from other sources (excluding lottery winnings and income from race horses), salary/pension, one house property, and agricultural income up to ₹5,000.
Wo Can Not Use ITR-4?
The following individuals, Hindu Undivided Families (HUFs), and firms (other than Limited Liability Partnerships) are not eligible to use ITR-4 for filing their income tax return in India:
1. Resident Not Ordinarily Resident (RNOR) and Non-Resident Indians (NRIs): Individuals who qualify as RNOR or NRIs for the relevant financial year cannot use ITR-4.
2. Total Income Exceeding ₹50 Lakh: Taxpayers whose total income exceeds ₹50 lakh during the financial year are not eligible to file ITR-4.
3. Agricultural Income above ₹5,000: If the taxpayer has agricultural income exceeding ₹5,000, they cannot use ITR-4.
4. Directors in a Company: Individuals who are directors in a company, whether it is a private or public company, are not eligible to file ITR-4. They need to use the appropriate income tax return form based on their income sources.
5. Income from More Than One House Property: If the taxpayer has income from more than one house property, they cannot use ITR-4. They need to use the applicable ITR form for individuals having income from multiple properties.
6. Income of Specific Nature: Taxpayers having income from specific sources are not eligible for ITR-4. These sources include winnings from lottery, income from owning and maintaining race horses, and income taxable at special rates under sections 115BBDA or 115BBE.
7. Holding Unlisted Equity Shares: Taxpayers who have held any unlisted equity shares at any time during the previous year cannot use ITR-4.
8. Deferred Income Tax on ESOP from Eligible Start-up: Individuals who have received Employee Stock Ownership Plan (ESOP) from an employer, which is an eligible start-up, and have deferred income tax on it, are not eligible to use ITR-4.
9. Non-Compliance with Eligibility Conditions: Taxpayers who do not meet the eligibility conditions specified for filing ITR-4 cannot use this form.
Procedure to File ITR-4 Online or Offline
1. Online Filing: You can file ITR-4 online through the official e-filing portal of the Income Tax Department . (https://www.incometax.gov.in). Fill in the form online, validate the details, and submit it electronically. You can e-verify the return using options like Aadhaar OTP, Net Banking, or other available methods.
2. Partially Online and Partially Offline Filing: You can also use the offline utility provided by the Income Tax Department. Download it from the e-filing portal, install it on your computer, and fill in the ITR-4 form offline. Generate an XML file of the filled-in form. Visit the e-filing portal to upload the XML file and submit your return online. Choose to e-verify the return using methods like Aadhaar OTP, Net Banking, or other options. Alternatively, you can sign a physical copy of the ITR-V and send it to the Centralized Processing Center (CPC) within 30 days.
Procedure to ITR-4 Online A.Y. 2023-24
Here is the procedure to file ITR-4 online for A.Y.2023-24.
Step 1: Log in to the e-Filing Portal
To begin the process of filing ITR-4 online, log in to the official e-Filing portal of the Income Tax Department using your user ID and password. (Procedure to check login on income tax portal)
Step 2: Access the Income Tax Return Section
On your dashboard, navigate to the “e-File” tab and select “Income Tax Returns” followed by “File Income Tax Return.”
Step 3: Choose Assessment Year and Filing Mode
Select the relevant Assessment Year (2023-24) and choose the filing mode as “online.” Click “Continue” to proceed.
Step 4: Select Applicable Status
Choose the applicable status option that best describes your taxpayer status “Individual/HUF” and click “Continue” to proceed further.
Step 5: Select the Type of Income Tax Return
Select the ITR form applicable to you “ITR-4”.
Step 6: Read the Instructions and Begin Filling out the Form
Carefully read the instructions provided on the screen to fill out the form correctly. Take note of the required documents and click “Let’s Get Started” to begin filling in the form.
Step 7: Review and Enter the Data
Review the pre-filled data in the form and make any necessary edits. Enter any remaining or additional data as required in each section of the form. Click “Confirm” at the end of each section to proceed.
Step 8: Answer Section 115BAC Questions
Answer the questions related to Section 115BAC, considering returns filed with business income. Select the relevant answers based on your previous tax regime choices and the filing of Form 10IE, if applicable.
Step 9: Enter Income and Deduction Details
Enter your income and deduction details in the appropriate sections of the form. Once completed, click “Proceed” to move to the next step.
Step 10: Review Tax Computation
If there is a tax liability, you will be shown a summary of your tax computation based on the details provided. You can choose to pay the tax immediately using the “Pay Now” option or pay later. It is recommended to use the “Pay Now” option to avoid any interest or default penalties.
Step 11: Verify the Return and Make the Payment
If there is no tax liability or if you are eligible for a refund, you will be taken to the Preview Return page. Review your return and proceed to validation. Once validated, select your preferred verification option and continue.
Step 12: e-Verify the Return
Choose the method through which you want to e-Verify your return and follow the instructions provided. It is mandatory to verify your return, and e-Verification is a quick, paperless, and secure method.
Step 13: Confirmation and Completion
Once you have successfully e-Verified your return, a confirmation message will be displayed. You can now consider your ITR-4 filing process complete.
Note: Remember to keep a copy of the acknowledgment for future reference.
Documents Required to File ITR-4 (Sugam) for A.Y. 2023-24
You generally do not need to attach any documents while filing your income tax return (ITR-4) online. The Income Tax Department has introduced the concept of “E-filing” or electronic filing, which allows you to file your return online without physically attaching any documents.
However, you should keep all the relevant documents mentioned below, such as Form 16, Form 26AS, bank statements, investment proofs, expense receipts, etc., ready for reference and verification purposes. These documents may be required by the Income Tax Department for scrutiny or verification at a later stage if needed.
It is advisable to maintain proper records of your financial transactions and supporting documents for a minimum of six years from the end of the relevant assessment year. These records should be available for inspection if requested by the Income Tax Department during the assessment or scrutiny process.
1. Personal Information:
– PAN (Permanent Account Number)
– Aadhaar Number (if applicable)
– Bank account details (account number, IFSC code, etc.)
2. Form 16: If you have received a salary from an employer, you will need Form 16, which provides details of your salary, tax deductions, and TDS (Tax Deducted at Source) information.
3. Form 26AS: This form shows details of tax credits, TDS, and other tax-related information as per the records of the Income Tax Department.
4. Form 16A: If you have received income other than salary and TDS has been deducted on it, you may need Form 16A.
5. Bank Statements: It is recommended to have bank statements for all your bank accounts for the financial year, as it helps in verifying your income and expenses.
6. House Property Documents: If you own a house property, you may need documents such as the ownership proof, rental agreements, and details of rental income received.
7. Investment and Expense Documents:
– Investment-related documents such as statements for fixed deposits, mutual funds, stocks, bonds, etc.
– Receipts for insurance premium payments, including life insurance and health insurance.
– Receipts for payment of tuition fees for yourself or your children.
– Receipts for donations made to eligible charitable institutions.
– Home loan interest certificates (if applicable).
8. Business and Profession Details (if applicable):
– Profit and Loss Account statement.
– Balance Sheet statement.
– Details of business expenses, such as rent, salaries, office expenses, etc.
– GST (Goods and Services Tax) details (if registered under GST).
– Bank statements related to business transactions.
9. Other Income Details:
– Details of income from other sources, such as interest income, rental income, capital gains, etc.
– TDS certificates, if any, for income other than salary.
10. Aadhaar OTP (One-Time Password): If you choose to e-verify your income tax return using Aadhaar OTP, make sure you have your registered mobile number handy to receive the OTP.
Changes in ITR-4 for A.Y. 2023-24
For A.Y. 2023-24, there have been certain changes in the ITR-4 form compared to previous years. Some of the key changes in ITR-4 for A.Y. 2023-24 include:
1. Eligibility Criteria: The eligibility criteria remain the same, with individuals, HUFs, and firms (other than LLP) who have income not exceeding ₹50 lakh during the financial year eligible to file ITR-4.
2. New Tax Regime Option: Individuals with business income can now opt for the new tax regime while filing ITR-4. However, they need to file Form 10-IE before filing the ITR to exercise this option.
3. Switching Between Old and New Tax Regime: Individuals with business income cannot switch between the old and new tax regimes every year. Once they have opted for the new tax regime, they can switch back to the old regime only once in their lifetime. They will need to fill out Form 10-IE again to switch back.
4. Presumptive Taxation Scheme: The presumptive taxation scheme under Sections 44AD, 44ADA, and 44AE remains applicable for ITR-4 users. These sections allow taxpayers to declare income at a prescribed rate based on the nature of their business or profession.
5. Form 10-IE for Opting/Withdrawing New Tax Regime: Individuals with business income who want to opt for or withdraw from the new tax regime need to file Form 10-IE before the due date of filing ITR, which is July 31 for non-audit cases and October 31 for audit cases.
6 Reporting Crypto and Virtual Digital Assets Transactions: Taxpayers will now be required to disclose details of transactions involving cryptocurrencies like Bitcoin, Ethereum, and other virtual digital assets. This includes information such as the nature of the transaction, the number of cryptocurrencies held, opening and closing balances, and any gains or losses incurred.
Pre-Requisites for Online Filing of ITR-4
These pre-requisites are necessary to ensure a smooth and efficient process of filing your ITR-4 online.
1. Valid PAN (Permanent Account Number): Ensure that you have a valid PAN issued by the Income Tax Department. PAN is a unique alphanumeric identification number required for filing income tax returns.
2. Access to the Income Tax Department’s e-Filing Portal: You need to have access to the Income Tax Department’s official e-Filing portal (https://www.incometax.gov.in). Register yourself if you do not have any account on incometax.gov.in.
3. Form 16 and Other Income Documents: Gather all the necessary income documents, such as Form 16 (provided by your employer), Form 16A (for income other than salary), and other relevant income statements like interest certificates, rental income details, and capital gains statements.
4. Bank Account Details: Keep your bank account details handy, including the account number, bank name, branch address, and IFSC code. This information is required for income tax refunds, if applicable.
5. Aadhaar Number: Ensure that you have a valid Aadhaar number issued by the Unique Identification Authority of India (UIDAI). Linking your Aadhaar with your PAN is mandatory for filing income tax returns.
6. Digital Signature Certificate (DSC): If you wish to electronically sign your ITR-4, you will need a valid Digital Signature Certificate. This is an alternative to signing the physical copy of the return.
7. Valid Email Address and Mobile Number: Provide a valid email address and mobile number during the registration process on the e-Filing portal. These will be used for communication and verification purposes.
8. Bank Account for Refund: If you are eligible for an income tax refund, ensure that you have an active bank account in your name for the refund to be credited. Check how you can pre-validate your bank account on the income tax portal.
Due Dates to File ITR-4 A.Y.2023-24
The due dates for the Assessment Year 2023-24 (Financial Year 2022-23) of ITR-4 are as follows:
For Individuals and HUFs (who are not required to get their accounts audited under the Income Tax Act or any other law):
– Non-audit cases: The due date is generally 31st July 2023.
– Audit cases: The due date is generally 31st October 2023.
Structure of ITR-4 A.Y.2023-24
The ITR-4 form consists of several sections that need to be filled out accurately before submitting the form online. These sections include Personal Information, Gross Total Income, Disclosures and Exempt Income, Total Deductions, Taxes Paid, and Total Tax Liability.
1. Personal Information:
– This section displays your personal information, which is auto-filled from your e-Filing profile. You can make necessary changes to your contact details, filing type details, authorized representative, partner details (if applicable), and bank details in your e-Filing profile.
2. Gross Total Income:
– In this section, you need to review the pre-filled information and verify your income sources, including salary/pension, house property, business or profession, and other sources such as interest income and family pension. You can also provide additional details if required.
3. Disclosures and Exempt Income:
– This section requires you to provide financial particulars related to your business, details of gross receipts reported for GST (optional), and any exempt income.
4. Total Deductions:
– Here, you can add and verify any deductions you are eligible for under Chapter VI-A of the Income Tax Act.
5. Taxes Paid:
– In this section, you need to verify the taxes you have paid in the previous year. This includes details of TDS (Tax Deducted at Source) from salary/other income, TCS (Tax Collected at Source), Advance Tax, and Self-Assessment Tax.
6. Total Tax Liability:
– This section displays the computation of your income, tax liability, and any applicable cess and interest. You should review your tax liability details based on the information provided in the previous sections.