What is ITR 4 form?
The ITR 4 is meant for those taxpayers who have opted for the presumptive taxation scheme under Section 44AD, Section 44ADA, or Section 44AE of the Income Tax Act.
However, if the turnover of the mentioned business exceeds INR 2 crores (INR 50 lakh in the case of professionals), the taxpayer will have to file ITR 3. You can also download income tax utility from the income tax department website.
Up to FY 2018-19 (AY 2019-20), it was not mandatory to file Income Tax Return if the total income was less than the basic exemption limit. However, Budget 2019 inserted the seventh proviso to Section 139(1). As per this new provision, if a taxpayer has entered into high-value transactions, it is mandatory to file the ITR even if the total income does not exceed the basic exemption limit. The high-value transactions can be either of the following:
- If the taxpayer has deposited more than INR 1 Cr in a current account
- If the taxpayer has incurred foreign travel expense of more than INR 2 lacs
- Or, if the taxpayer has incurred electricity expense of more than INR 1 lac
Who can file ITR 4?
Individual/HUF/Partnership firm whose total income includes following can use this form:
- Income from Business eligible for Presumptive taxation scheme
- Individuals with income up to INR 50 Lakh
- Income from Profession or Freelancing eligible for Presumptive taxation scheme
- Income from Salary/Pension
- Income from One House Property (excluding cases where losses are brought forward from the previous year)
- Income from Other Sources (Excluding Winning from Lottery and Race Horses)
- HUFs and Non-LLP firms with incomes up to INR 50 Lakh
File Your Tax Return
On Time , Online on Quicko.com
Open Your Account Today
File Your Tax Return
On Time , Online on Quicko.com
Open Your Account Today
Who can not file ITR 4 Form?
This Return Form cannot be used in case of the following incomes:
- Income from more than one House Property
- Winning from Lottery and Race Horses
- Income from Capital Gains
- Agricultural income exceeding INR 5000
- Income from speculative business
- Individual who has brought forward or carry forward loss from “Income from house property“
- Income from Foreign Sources and/or having any Foreign Asset
Structure of ITR Form Number 4
| Part/ Schedule | Heading | Fields |
|---|---|---|
| PART A- GENERAL | Personal Information | Name, Address, Date of Birth, PAN, contact details, etc. |
| Filing Status | Employer Category, Tax status, Residential status, Return filed u/s, etc. | |
| PART B | Income And Deduction | Income from Business, Salary, Pension, House Property, Other Sources |
| PART C | Deduction under Chapter VI-A | Deductions under section 80C, 80D, 80E, 80G, 80TTA, etc. |
| PART D | Tax computation | Breaking up Tax computation, Interest, Cess, Rebate, etc. |
| Schedule NOB BP | Nature of Business, If more than one business, indicates the three main activities/ products | Nature of Business, Computation of Presumptive Income under 44AD, 44ADA and 44AE, Financial Particulars of Business |
| Schedule AL | Details of Assets and Liabilities | Details of an immovable asset, Details of a movable asset, Interest held in the asset of a firm or AOP, etc. |
| Schedule IT | Details of Advance Tax and Self Assessment Tax Payments | BSR Code, Date of Deposit, Chalan Number, Tax Paid |
| Schedule TCS | Details of Tax Collected at sources | Tax collection Account Number, Name of Collector, Tax Collected, Amount Claimed |
| Tax Details | TDS1: Details of Tax Deducted at Source from SALARY | TAN of Employer, Employer Name, Ted Deducted, etc. |
| Tax Details | TDS2: Details of Tax Deducted at sources from Income other than Salary | TAN, Name of Deductor, Year of Deduction, Tax deducted, etc. |
List of Documents Needed to file ITR 4
Acquire the given list of documents on the basis of relevant Incomes in order to indulge in a smooth filing process.
Essential documents:
- PAN (Permanent Account Number)
- Bank account details
- TDS certificates
- Counterfoils of taxes paid
- Details of original return if filing revised return
- Details of notice if filing in response to the notice
- Electricity bill (In case it exceeds INR 1 Lakh)
- Travel expenses (In case it exceeds INR 2 Lakh)
- Deposits in Bank (INR 1 Crore or above)
Documents on the basis of your type of Income:
- Salary income
- Form 16 / Salary slips received from your employer and
- Pension statement/passbook.
- House/Property Income
- Address of the property,
- Co-owner details in case the property is coowned,
- In case of house/property loan Interest certificates/repayment certificate from bank,
- In case of let out property – Rent agreement
- Business / Profession
- Profit & Loss statement
- Balance Sheet
- Supporting documents for expenses incurred
- Bank account statement/Passbook
- Cash register
- Any other documents required to maintain the books of accounts of business & profession
- Other sources
- Savings/current account statements/Passbook
- Interest certificates for deposits/bonds/NSC
- PPF account statement/Passbook
- Dividend warrants/counterfoils
- Rent agreement in case of let out machinery
- Details about receipts of any other incomes
- If you’re eligible for any Tax Breaks, you may need to acquire the relevant documents from the list:
- PPF account statement/Passbook
- Fixed deposit certificates/statements
- Mutual fund NAV statements
- ELSS/ULIP/NSC investment details
- Life insurance premium receipts
- Medical insurance premium receipts
- Preventive health checkup details
- Pension fund/ National pension scheme statement
- House/property loan interest certificate/repayment statement
- Education loan interest certificate/repayment statement
- Tuition fees receipts
- Donation receipts
- Certificate from specified medical authorities in case of disability
- Receipts/proof of any other tax saving investment/contributions
ITR 4 Form Breakdown
The ITR 4 has six sections that are required to be filled. These sections are as follows:
- Personal Information
- Gross Total Income
- Disclosures
- Total Deductions
- Taxes Paid
- Total Tax Liability
How to file the ITR 4?
You can either file your ITR 4 physically or electronically. Since the Financial year 2013-14, electronic filing of ITR 4 has been made compulsory for the taxpayers who:
- Have an income of more than INR 5 Lakhs.
- Have any assets outside of India, including financial interest in any entity; or signing authority in any account outside of India
- Those claiming relief under Section 90/90A/91 to whom Schedule FSI and Schedule TR to apply
In case of Physical submission:
- You can submit the ITR 4 in paper form or
- You can submit the bar-coded return form duly filled.
The department will provide you with an acknowledgment along with stamp of submission on your copy.
File ITR 4 Online using Income Tax Website
- Log in to the e-filing portal using your user ID & password.
- Click on e-file > Income Tax Returns > File Income Tax Return from the dashboard
- Select the appropriate assessment year
- Select the online mode of filing the ITR
- Select the applicable status and click on proceed
- Select the ITR 4 option from the list provided
- Read the instructions and click on the option to proceed
- Select the options that are applicable to your particular situation and click on proceed
- Review the prefilled data and click on proceed
- Enter your income and deduction details in the different section
- You will be shown a summary of your tax computation based on the details you provided. If there is tax liability payable based on the computation, you will receive the option to pay instantly or pay later
- After paying tax, click Preview Return. If there is no tax liability payable, or if there is a refund based on tax computation, you will be taken to the Preview and Submit Your Return page
- Once validated, on your Preview and Submit your Return page, click Proceed to Verification
- On the Complete your Verification page, select your preferred option and click Continue
ITR 4 for AY 2021-22
Major Changes in ITR 2 for AY 2021-22
- Taxpayers are given the option to choose between the old tax regime and the new tax regime
- Dividend Income has to be added with a quarterly breakdown for accurate calculation of Interest under Section 234C
FAQs
No. NRI can not file ITR 4. They need to file ITR 3 for income earned from Business & Profession.
No, since presumptive taxation scheme is only available to businesses having turnover up to INR 2 Crore. You can not opt for the Presumptive Taxation Scheme and file ITR 4.
No. since presumptive taxation scheme is only available to professionals having receipts up to INR 50 lakhs. You can not opt for the Presumptive Taxation Scheme and file ITR 4.
Yes, ITR 4 can be filed after the due date. It will be considered a belated return. And late filing fees will be levied while filing a belated return.
Hey @TeamQuicko
Thanks for the blog! Just one quick question - Why do we have to report a quarterly breakdown of Dividend Income under IFOS?
Thank you!
Hey @TanyaChopra
This quarterly breakdown of Dividend Income under IFOS will help to calculate and determine penalty u/s 234C for the delay in payment of Advance Tax.
Hope this helps!
I had received dividend recently but I had noticed that TDS had been deducted. any idea as to why has it happened and is there a way I can claim this TDS?
Hey @HarshitShah
After the introduction of Budget 2020, dividend income is now taxable in the hands of the shareholder; and is also subject to TDS at 10% in excess of INR 5000 u/s 194 & 194K. Foreign Dividend is taxable at slab rates. TDS is not applicable to such dividends. The taxpayer should report such income under the head IFOS in the ITR filed on the Income Tax Website.
Hope this helps!
Hey @HarishMehta
Yes, dividend income is now taxable from FY 2021-22 onwards and it has to be reported under the head of IFOS.
You can read more about it here:
Hi @Maulik_Padh,
You need to pay Income tax on the net taxable income, i.e. after subtracting deductions, expenses, etc.
If the net taxable income is negative i.e. if there is loss, you can carry it forward when filing the ITR
Here are some of the articles which might help
Hi @ameyj
The amount of TDS deducted shall reflect in your Form 26AS only and it will also reflect the name of the deductor.
Using the name of the deductor you can find out on which share you have received the dividend and you can also cross-check the same in your bank statement.
Yes, you are right, TDS is to be deducted when the dividend paid exceeds 5000 INR in a financial year. However, the 5,000 INR limit pertains to all the dividends an individual gets in a year, or the total dividend per shareholder that a company pays out in a year, is left to interpretation, and hence registrars and share transfer agents (RTA) are not taking any chances and are deducting TDS even on small amounts.
Hope this helps
Hi @ameyj
You can submit a grievance on Income Tax Portal mentioning the issue and also attach the 26AS.
The other option is to leave it as it is and clarify it when the tax department sends the notice.
Hi @TeamQuicko
Consider that I have 10 shares each of 10 different Indian companies. Each of the 10 companies are declaring a dividend of INR 100 before the FY ends. Now I will be recieving 1000 as dividend from each company, thereby a total of 10,000.
The 5,000 dividend limit, is it applicable to each company / total dividend recieved by me in a year. If it is applicable to each company, then I would not attract TDS of 10% for dividend.
Also pl clarify, how would the company B know that I have got shares of Company A,C,D,E so on…
@Saad_C @Laxmi_Navlani @Divya_Singhvi @Kaushal_Soni @AkashJhaveri can you help with this?