Filing Income Tax return (ITR) is a crucial annual obligation for taxpayers in India. The ITR-4 form, specifically designed for individuals and Hindu Undivided Families (HUFs) having income from a proprietary business or profession, requires careful attention to detail and adherence to specific guidelines. This comprehensive guide will walk you through the process of filling out and filing the ITR-4 form, ensuring compliance with tax regulations and maximizing deductions where applicable.
Overview of ITR-4
The Income Tax Return ITR-4, also known as Sugam, is designed for individuals, Hindu Undivided Families (HUFs), and firms (excluding LLPs) who choose the presumptive income scheme under Sections 44AD, 44ADA, and 44AE of the Income Tax Act. This scheme simplifies the tax filing process by allowing eligible taxpayers to declare income at a fixed rate, significantly reducing the need for maintaining detailed books of accounts. The presumptive income scheme is particularly beneficial for small businesses and professionals, as it streamlines compliance and lowers administrative burdens. By opting for ITR-4, taxpayers can focus more on their business activities rather than the complexities of tax documentation. This form is an efficient tool for those looking to ease their tax filing process while ensuring compliance with the Income Tax Act.
Types of incomes covered
ITR-4 covers various types of incomes, including:
- Income from business or profession under the presumptive income scheme.
- Salary or pension.
- Income from one house property (excluding cases where loss is brought forward from previous years).
- Income from other sources (excluding lottery winnings and racehorses).
Step-by-step guide on how to file ITR-4
Step 1: Collect the necessary documents
Gather all relevant documents, including your PAN card, Aadhaar card, bank statements, TDS certificates, and proof of investments. Ensure you have the details of any home loan, especially if you are claiming deductions for the same.
Step 2: Download the ITR-4 form
Visit the official Income Tax Department website and download the ITR-4 form. You can also use the online e-filing portal for a more streamlined process.
Step 3: Fill in personal information
Enter your personal information, such as name, address, PAN, Aadhaar number, and contact details, in the ITR-4 form.
Step 4: Provide income details
Input your income details from various sources:
- For business income under the presumptive scheme, declare the gross turnover and calculate the presumptive income.
- For salary income, provide the salary details as per Form 16.
- For house property income, mention the rental income and any deductions.
- For other sources of income, specify the interest earned and other relevant details.
Step 5: Claim deductions
Claim deductions under various sections such as:
- Section 80C for investments in PPF, NSC, life insurance, etc.
- Section 80D for medical insurance premiums.
- Section 24(b) for interest on home loans. Ensure you understand how to claim HRA while filing ITR, as it can significantly reduce your taxable income.
Step 6: Compute tax liability
Calculate your total income and apply the appropriate tax rates to compute your tax liability. Ensure you account for any advance tax paid or TDS deducted.
Step 7: Verify and submit
Review all the details entered in the ITR-4 form to ensure accuracy. Submit the form online and verify it using Aadhaar OTP, EVC (Electronic Verification Code), or by sending a signed copy to the Centralised Processing Centre (CPC) of the Income Tax Department.
Filing and submission
The process of filing and submission of ITR-4 can be done electronically through the Income Tax Department's e-filing portal. Once the form is submitted, it needs to be verified. You can verify your return electronically through Aadhaar OTP, net banking, or by sending a physical copy of the ITR-V (Verification) to the CPC within 120 days of filing the return. Proper verification ensures your return is processed promptly.
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