1. Who is eligible to file an ITR-4 for the AY 2022-23?
ITR-4 may be completed by any Resident or HUF/Firm (other other than LLP) that has:* The amount of income should not exceed 50 Rs. Lakh in the course of the FY* Income earned from Business and Profession which is calculated on a presumptive basis under the 44AD, 44ADA, or 44AE.* Income from Salary/Pension one house Property or Agriculture Income (up to Rs . 5000+)Other sources that include (excluding the winnings from Lottery and the income earned from race Horses):o Interest from the Savings AccountInterest from the Deposit (Bank Post Office, Bank Cooperative Society)o the interest from income tax refundo Family Pensiono Interest on enhanced compensationOther Interest Income (e.g. the Interest income from loans that are not secured)
2. Who isn't eligible make an ITR-4 to file for FY 2022-23?ITR-4 is not completed by an Individual or HUF/Factory (Other that LLP) that:* is Resident Not Ordinarily Resident (RNOR) Non-Resident Indian* is able to earn more than 50 rupees Lakh* earns agricultural income that is greater than Rs5,000or*.A Director is an individual of an organization.* has earned income through more than one House Property;* earns an income of the following type:O lottery winners;The business of running and maintaining race horses;O income taxed at special rates under Section 115BBE, 115BBDA, or Section 115BBDA;* held any equity shares that were not listed at any point in the preceding year.* deferred tax on income on ESOP that it received from its employer, thereby making it an qualified start-up* is not covered by the eligibility criteria for ITR-4.
3. What is the change in ITR-4 when compared to prior years?
Comparatively to previous years, ITR-4 from 2022-23 comes with the option that you must answer the following questions:* Have you chosen to go with the new tax rules under 100BAC and submitted Form 10IE in the year 2021-22?Select Yes or No.* Alternative for the the current assessment year?Select Now to opt-in/Not opting/Continue to opt-out or opt-in.Note that an the HUF or individual who is opting for a new tax regime under the 115BAC must complete Form 10-IE prior to the due date for filing of return under 139(1). After the filing of Form 10-IE, the original return or a revised one is required to be filed mandatoryly in order to take advantage of the new tax slabs under the 115BAC as well as Acknowledgement number and the date of filing Form 10IE are compulsory fields in the ITR-4.
4. What documents do I require to file an ITR-4?You must keep these documents in your possession (as appropriate) to file the ITR-4* Formula 16* Form 26AS and the AIS* Form 16A* Bank Statements* Housing Certificates of Interest on Loans* Receipts for Donations Made* Rental Agreement* Rent Receipts* Investment premium payment receipts - LIC, ULIP etc.
5. What is the presumed taxation method for ITR-4 filers?In accordance with Sections 44AA and 44AE in The Income Tax Act (1961) the person who is engaged in any profession or business must to keep regular books of accounts, under certain conditions according to specific conditions. To ease the burden of small-scale taxpayers this burden of compliance as well, tax authorities under the Income Tax Act has framed the presumptive taxation scheme in accordance with 44AD, 44ADA and. Anyone who adopts the taxation scheme that is presumptive can declare their income at a specified rate. The Act has set out the presumptive taxation scheme (for people who are using ITR-4) according to the following ** Section 44AD: Calculation of income based on estimates for taxpayers (being Resident Individual Resident HUF, Resident Individual, or Resident Partnership Company (other other than LLP) involved in certain types of business subject to certain restrictions."* Section 44ADA Calculation of professional earnings on an estimated basis Assessee living in India and working in a trade mentioned under Section 44AA (1) subject to certain conditions.*Section 44AE: Calculation of income on an estimated basis for taxpayers (being an individual or HUF, Firm (other other than LLP) as well as any other individual who is a citizen or not) operating in the field of leasing, plying or renting goods transporters who have less than ten vehicles in any one time in the preceding calendar year.
6. Who aren't eligible to the taxation scheme that presumptively applies to Section 44AD?The Section 44AD scheme is intended to grant relief to taxpayers who are small and engaged in any kind of business, with the exception of the following:* Businesses of plying, hiring or leasing goods carriages as defined in section 44AE.* A person operating any agency-related business* A person who earns income through commissions or brokerage (e.g. insurance agents)* Any company whose overall gross or total turnover is more than the amount of Rs. 2 CroreOther than that the above, a person who is required to keep books of account as per the guidelines mentioned under Section 44AA (1) is not eligible for the presumptive taxation under the 44AD.
7. The total revenue of my business during the last year exceed two crores. Do I have the option of opting for the presumptive taxation under the 44AD scheme?No. You are able to opt for the taxation scheme that is presumptive under section 44AD only if your total turnover or gross revenue from your company do not exceed the amount that is prescribed (i.e. two times Rs. Crore).
8. I chose the presumptive taxation scheme under 44AD in my last ITR filed. If I don't choose it within the next five years, what would happen?If you select the presumptive taxation, you have to adhere to this same plan for the next five years. If you do not, the presumptive taxation scheme won't be in place for the next 5 years. As an example, suppose you claim to be taxed on presumptive income u/s 44AD for the years 2019-20, the AY 2020-21, and the AY 2021-22. But, for AY 2022-23 let's say you chose not to use the taxation scheme that presumptively applies. In this scenario it is unlikely that you'll be able to avail the benefits of the presumptive taxation scheme in the subsequent five AYs (AY 2023-24 through 2027-28).
9. Who is eligible for the presumptive taxation scheme in Section 44ADA?The presumptive taxation scheme under Section 44ADA is a possibility by a resident of India performing a specific professions whose total earnings don't exceed 50 rupees Lakh in the course of a fiscal year. The following professions are considered to be specified:* Legal* Medical* Architectural or Engineering* Accounting* Technical Consultancy* Interior Decoration* Any other profession as specified by CBDT
10. I chose to use the presumptive income scheme under the Section 44AD and 44ADA. Can I claim additional deductions for expenses once I have declared profits at the applicable rate in the respective sections of gross revenue?A person who has opted for the tax presumptive scheme is presumed to have claimed every expenses deductions. The possibility of claiming deductions in the future is not permitted after declaring profits at a specified amount. You can however claim deductions under Chapter VI A.
11. I chose the presumptive income plan of Section 44ADA. Do I need to make Advance Tax in respect of the income earned from a profession that is covered under Section 44ADA?Yes. anyone who chooses to use the taxation scheme that presumptively applies to you under section 44ADA must pay the entire Advance Tax by 15th March of the preceding year. If you do not make the Advance Tax by 15th March of the previous year, you'll be responsible for paying interest according to Section 234B as well as Section 234C. Any amount you pay in the way or in the form of Advance Tax on or before 31st March is considered to be Advance Tax paid during the year that ended on that day.
12. I chose to use the presumptive taxation under Section 44ADA. Do I have to keep books of account as per Section 44AA?If you're in a specific profession mentioned to in Section 44AA (1) and choose to use the presumptive taxation under Section 44ADA (declare the income as 50 percent of your gross earnings) You are not required to keep the books of accounts for the of a specific profession (i.e. the requirements of Sections 44AA does not apply).
13. I chose the presumptive income scheme under Section 44AE. Do I have to keep books of accounts in accordance with Section 44AA?The Section 44AA in the Income Tax Act, 1961 contains provisions regarding the maintaining books of accounts by those working in the professional or business. If you choose to use the taxation scheme that is presumptive under Section 44AE, the provisions in Section 44AA relating to maintenance of books of accounts do not apply.
14. I chose the taxation system that is presumptive in Section 44AE. Do I need to contribute Advance Tax in respect of the business income that is covered under Section 44AE?Yes, you will be required to pay Advance Tax. There is no concession in regards to the amount of advance tax if chose to use the tax scheme presumptive to section 44AE.
15. How do I calculate the income of a house that is self-occupied but partially let out?House Property House Property may consist of two or more separate units, of which one is occupied by a tenant and the rest is used for a different use (i.e. lease-out, let-out, or for business purposes). The earnings from the property will be calculated according to the following method:1. A part or unit that is used as your entire year will be considered an independent property, and the earnings from such a portion or unit will be calculated according to the method explained in the ITR-4 user's manual in the event of a property that is self-occupied.2. The unit or part that has been let will be considered as a separate property and the earnings from such
