What is ITR 4 (SUGAM) in the Income Tax Act?

The Income Tax Department has notified different ITR forms on the basis of the nature of income & class of people like ITR-1, ITR-2, ITR-3 etc. to file income tax returns.
Form ITR-4 (SUGAM) is a simplified form used by the taxpayers who are opting for presumptive taxation scheme under section 44AD, section 44ADA and section 44AE.
Download ITR 4

ITR 4 SUGAM for FY 2021-22(AY 2020-21)

Who can file ITR-4?

  • Resident Individuals or HUFs or Firms (other than LLP) having total income upto ? 50 lakh. (Non- Residents are not eligible to fill ITR-4)
  • Resident Individuals or HUFs or Firms having given below source of income :
    1. Income from business & profession and who has opted presumptive taxation scheme under section 44AD, 44ADA or 44AE of the Income Tax Act and who is having income as per ITR-1 such as
    2. Income from one house property
    3. Agriculture income upto Rs. 5,000/-
    4. Other source income
    5. Salary Income

Who cannot file ITR-4?

ITR-4 cannot be filed by an assessee having

  • Director of a company.
  • Investment in unlisted shares of a company at any time during the year’
  • Any assets located outside India or having any signing authority in any account located outside India.
  • Non-resident of India - NRIs
  • Capital gain income
  • Income from outside India
  • Lottery income or income from owning and maintaining racehorses
  • Income taxable at special rates
  • Agriculture income more than Rs. 5,000/-
  • Income from more than one house property
  • Any brought forward losses or losses to be carried forward
  • Is assessable for the whole or any part of the income on which tax has been deducted at source in the hands of a person other than the assessee.

What is the due date of filing ITR-4 for FY 2020-21

For FY 2021-22 (AY 2020-21) the due date of filing ITR-4 was 31 December 2021 which has been extended to 15 February 2022.

Major Changes for FY 2020-21 (AY 2021-21)

We will understand new changes in two parts :

  • Additional disclosure
  • Details/particulars deleted
Additional disclosure
  • If any taxpayer is filing a return under the seventh provison to section 139(1) then they should give additional disclosures. Seventh provision to section 139(1) covers taxpayers whose income does not exceed the threshold limit but they have :
    1. Deposited Rs. 1 crore or more in one or more current account during the particular financial year or
    2. Incurred expenditure of Rs. 2 lakh or more during the financial year for travel to a foreign country for self or any other person or
    3. Incurred expenditure of Rs. 1 lakh or more during the financial year in relation to the electricity bill.
    In all the above cases, taxpayers are required to disclose the amount of such transactions . Additional disclosure
  • The Aadhaar of representatives can also be given in place of PAN. Additional disclosure
  • Column of deduction of interest on enhanced compensation u/s 56(2)(viii) has been added under Income from other sources. Additional disclosure
  • Name and address of the employer will auto-populate in case the TAN of the employer will be furnished.
  • In Budget 2019, some new deductions under Chapter-VIA were introduced like deduction u/s 80EEA & 80EEB have been added. Simultaneously, the same has been incorporated in ITR-4 also.
    In addition, 80CCG has been phased out in line with the unavailability of this deduction in near future. Additional disclosure
  • Schedule DI has been added to report the investments made between 1st April 2020 to 30th June 2020 and the amount which the taxpayer wishes to claim out of this investment for the FY 2021-22 Schedule DI
  • While stating the details of bank accounts one or more bank accounts can be selected for refunds. In case more than one bank account is selected the choice shall lie in hands of CPC as to in which account shall the credit of refund will be made. bank accounts

ITR 4 SUGAM for FY 2018-19(AY 2019-20)

Who can file ITR-4?

Form ITR- 4 also popularly known as Sugam can be filed by these people under the income tax provisions, namely,

  • Individuals,
  • HUFs and
  • Firms (other than LLP),
  • Who are residents of the country and
  • Having total income up to ? 50 Lakh in the previous year and
  • Also by those deriving income from business and profession, computed by sections 44AD, 44ADA or 44AE on the presumptive basis.

Who cannot file ITR4?

We have already understood the cases in which Form ITR 4 can be filed. But, there are certain categories of the assessee under the income tax act who cannot file this ITR 4 form. This form is not applicable to individuals who are either.

  • Director in a company or
  • Has invested in unlisted equity shares of a company.

What is the due date of filing ITR-4 for FY 2021-22?

For FY 2020-21 (AY 2021-22) the due date of filing ITR-4 was 31st December 2021 But, a belated ITR-4 can still be filed till 15th February 2022, especially for the one whose account needs to be audited.

How do I fill ITR 4?

You can submit ITR4 form by 2 ways

  • Online
  • Offline

Offline: The ITR form can be filed offline when the age of the Individual is 80 years or more.Also, when The income of the individual is less than Rs 5 lakhs and who do not have to claim a refund in the income tax return

There are two ways income tax can be filed. The return can be filed offline by furnishing a return in a physical paper form or a bar-coded return. Post that,The Income Tax Department will issue you an acknowledgement at the time of submission of your physical paper return.

Online: You can file the return electronically by using a digital signature. If you are submitting your ITR-4 form using a digital signature, you will be receiving the acknowledgement to your registered email ID.You can also download it manually from the income tax website. While you are sending the data electronically and then submitting the verification of the return in the return form ITR-V.

You need to sign it and then send it to the Income Tax Department’s Office Bangalore within the 30 days of the e-filing.

How to fill form ITR-4?

Let us now understand ITR 4- Sugam, form in detail for each of its categorized parts.

Part A: Personal Information & Filing Status

The first part of this form is related to the personal information of the assessee such as

  • Name,
  • PAN,
  • Address,
  • Date of Birth,
  • Email and
  • Mobile number, etc.

The next part shows the filing status of the return, i.e., whether it is a revised return or return in response to some notice issued by the income tax department or return filed by the assessee himself or by any of his representatives and details of such representative.

Part B: Gross Total Income

Now comes the part for the calculation of Gross Total Income.It is the aggregate of income calculated under all different heads of Income.

  • Income from Business and Profession is calculated in the schedule on a presumptive basis based on the relevant section.
  • Income taxable under the head ‘Salary’: it is to be calculated the same as in the case of ITR-1. First, determine the monetary and non-monetary part of the salary and then deduct the allowance exempt under section 10. Then allow deduction under section 16, i.e., standard deduction, entertainment allowance, professional tax. To get the amount chargeable to tax under the head income from “Salaries.”
  • Income from House Property: Calculation of income from house property where maximum loss that can be set off in a period is limited to Rs. 2 Lakhs.
  • Other sources: Income from other sources can be calculated by specifying the source of such income from the drop-down list. After that, a standard deduction u/s 57 (iia) is available toward the family pension.

Part C: Deductions and Total Income

Now, allow for deduction under Chapter- VIA of the Income Tax Act 1961. The quantum of such deduction is based on the amount invested by the assessee.

Deductions and Total Income

Now, calculate the tax liability based on the income tax slab applicable to the income group of the assessee. And allow for Rebate u/s 87 A if income is less than Rs. 3.5 Lakh. And allow for Relief u/s 89 in respect of salary arrears received.

Schedule BP of ITR 4 – Sugam

The schedule for calculating Business Income is as follows:

  • The first set of presumptive income is for Business income under section 44AD.
  • Presumptive income of Profession is covered under section 44 ADA
  • And for goods carriage, the presumptive income is calculated under section 44 AE.
  • It also contains a column for information regarding Turnover/ Gross Receipt reported for GST.
  • After that, it also contains financial particulars for Business.
Schedule BP Schedule BP Schedule BP

TDS Schedule under Indian Income Tax Return form ITR 4

Part 19 is related to the Tax Deducted at source from salary. This schedule is populated using the Form 16 issued by the Employer. It incorporates details such as:

  • TAN of deductor,
  • Name of the employer,
  • Income under Salary, and
  • Tax deducted thereon.
20 TDS

Part 20 TDS 2(i) is for TDS on Income other than Salary as per the Form 16A furnished by the deductor.

20 TDS

And Part 20 TDS 2(ii) is for TDS on Rent and as per Form 16C TDS certificate for Rent.

Schedule IT of Income Tax Return Form ITR 4

Part 21 is for providing details regarding the payment Advance Tax during the year and self-assessment tax paid at the end of the period. This Schedule requires the assessee to fill the information given on the payment challan such as BSR Code, Serial Number of Challan, date of payment, amount, etc.

21 Sch IT

Schedule TCS of Income Tax Return Form ITR 4

TCS Schedule 22 consists of details regarding the Tax Collected at the source and as mentioned in the Form 27D issued by the collector.

22 Sch TCS

Part 21 is for providing details regarding the payment Advance Tax during the year and self-assessment tax paid at the end of the period. This Schedule requires the assessee to fill the information given on the payment challan such as BSR Code, Serial Number of Challan, date of payment, amount, etc.

Schedule – Taxes Paid and Verified of Income Tax Return Form ITR 4

In the next schedule, the total tax liability that the assessee is required to pay is automatically calculated. Such liability is calculated after considering the details furnished in the previous schedule. Net liability or refund is calculated by taking the difference of total tax paid from tax liability calculated based on income.

  • Column / Part 28 is for providing the bank account details of assessee held in India at any time during the previous year but not including the dormant accounts.
  • The above bank account details are followed by the Declaration regarding true and fairness of the information provided. And filing the return in the capacity of Self, Karta, Representative, and Partner.
  • If the Tax return Preparer prepares the return, the details of such TRP is to be provided along the amount to be paid to TRP.

Schedule 80G of Indian Income Tax Return Form ITR 4

The Last schedule is to calculate the total amount of deduction to be claimed under section 80G for contributions/ donations made to the charitable institutions.

  • The First two parts are for calculating deductions without any qualifying limit specified under the law. The listing is to be made as the donations eligible for 100% deductions and includes details of the donee and type of donation made.
  • After that donation eligible for a deduction of 50% of the donated amount. Schedule 80G
  • The next two parts i.e, C & D are for donations having qualifying limit as specified under the Income Tax Act 1961. Schedule 80G
  • Part E reflects the cumulative deduction amount claimed under section 80D.
For further details on ITR forms Read More.

What are the different ways of submitting ITR4?

There are two options to file ITR-4 :

1- Paper Form : It can be filed in a physical form or by furnishing bar coded return. Paper Form ITR is allowed in only in case of super senior citizen.

2- Electronically : Return can be filed on the e-filing portal of Income Tax Department. After filing, return needs to be verified through

  • Digital signature or
  • Authenticating by EVC or
  • By sending ITR-V (duly signed) by post to CPC in 30 days

Income Tax Return Form ITR 4

What are the major changes made in ITR-4 for AY 2021-22?

Major changes in ITR-4 for FY 2021-22(AY 20-21) include:

  • If any person has presumptive income and holds directorship in a company then he/she cannot file ITR-4, he needs to file ITR-3.
  • If any person has presumptive income and holds shares of an unlisted company then the individual is not eligible to file ITR-4. In such cases, he needs to file ITR-3.
  • Only super senior citizens can file a paper form return.

Verification of ITR-4

After successful filing, the income tax return needs to be verified. The verification is required to be done within 30 days of filing ITR. It can be done online i.e. e-verification through an OTP (One Time Password) or EVC (Electronic Verification Code). Alternatively, the offline process can be followed by sending the signed copy of ITR V to CPC Bangalore. For more details refer to our guide on How to verify your Income Tax Return.

Frequently Asked Questions

Q- Do I need to file ITR-4 if my income is less than the threshold limit but total electricity bill paid during the year is Rs. 1,05,000/- ?

Ans. Yes, for FY 2021-22 ITR-4 needs to be filed in this case even if income is less than the threshold limit.

Q- Can I file ITR-4 if audit u/s 44AB is applicable to me?

Ans. ITR-4(SUGAM) is a simplified form which cannot be filed by the individuals to whom the audit is applicable.

Q- Am I eligible to file ITR-4 if I am a joint owner of house property?

Ans. For FY 2021-21 ITR-1 & ITR-4 cannot be filed by an individual who is a joint owner of a house property. For FY 2021-22 you can file ITR 4 in this case.

Q- What is Presumptive Income?

Ans. As the name suggests under presumptive method of taxation no actual computations for determining the profits or losses of the businesses are made. The turnover is reported and a certain percentage of it is taken as taxable income for the year. In case of business u/s 44AD minimum 6% of the business turnover is required to be reported as taxable income in case the transaction is undertaken through electronic modes and 8% otherwise. To learn more about presumptive income and taxation Read More..

Q- Is it compulsory to file the ITR4 form for 5 consecutive years once filed in a particular year?

Ans. If a taxpayer is opting for Presumptive scheme as per section 44AD then he/she shall have to file ITR4 for 5 consecutive years.

Q- The new ITR-4 is requiring GST as mandatory to file an ITR. But I have not registered under the GST. How should I file my ITR?

Ans. ITR 4 can also be filed if taxpayers are not registered under GST Law.

Q- What are the key changes in the ITR 4 utility released by Government of India for filing Income Tax return of A.Y. 2019 - 20?

Ans. In New ITR4, individual taxpayers who have presumptive income and also hold directorship in companies or hold shares of unlisted company will not be eligible to file form ITR-4.

Q- If a businessman has filed ITR 4 for previous years and now he wants to file ITR4S, can he switch (he is covered under the presumptive scheme)?

Ans. ITR 4S is not available for A.Y. 2019-20.

Q- Can I file the ITR-4S form in place of the ITR-4 if I already filed the latter?

Ans. ITR 4S is not available for A.Y. 2019-20.

Q- What is the procedure if I submitted the ITR-4 form instead of an ITR-1 form?

Ans. If the wrong ITR Form has been filed , then the return is a defective return, to make it validate, file the revised return.The last date for revised return is the end of the relevant assessment year

Q- I am a salaried person. I also deal in share trading. Which ITR should I file?

Ans. ITR Form will depend whether the taxpayer intends to show share trading as capital gain or Business Income.

Q- Which ITR (1 or 4) form has to be filed if a doctor gets a salary from a private hospital and also receives the form 16A?

Ans. Doctor needs to file ITR 4.

Q- How should I file an ITR-4 if the only income I have comes from tuition and house rent?

Ans. Taxpayers can consider his tuition income as business covered u/s 44ADA, and can file his return accordingly.

Q- Can I file the ITR 4 under 44ADA if I filed the ITR 3 last year which was the first year of filing? The 5 years limit is for 44ADA as well.

Ans. Yes, Taxpayers can file ITR 4 if she/he filed ITR3 last year and the limit of 5 years is not applicable on Sec. 44ADA

CA Abhishek Soni
CA Abhishek Soni

Abhishek Soni is a Chartered Accountant by profession & entrepreneur by passion. He is the co-founder & CEO of Tax2Win.in. Tax2win is amongst the top 25 emerging startups of Asia and authorized ERI by the Income Tax Department. In the past, he worked in EY and comes with wide industry experience from telecom, retail to manufacturing to entertainment where he has handled various national and international assignments.



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