HOW To File INCOME TAX RETURN (ITR) For SMALL BUSINESSMAN | Income Tax E-Filing | ITR 4 LIVE DEMO
HOW To File INCOME TAX RETURN (ITR) For SMALL BUSINESSMAN
The old ITR-4S tax form has been renamed ITR-4. This VIDEO contains information on filing ITR-4 for FY 2016-17 (AY 2017-18)
Who can file ITR 4 ?
ITR 4 can be filed by all those who opt for presumptive income for instance
a small businessman having turnover less than Rs 2crore may opt for the scheme u/s 44AD and declare the profits at 8% of gross receipts(6% in case of digital receipts) .To know more ,click here
A doctor can opt for presumptive income scheme u/s 44ADA if his gross receipts do not exceed Rs 50 lakhs and can declare 50% of gross receipts as his income.To know more ,click here
An engineer can also opt for this scheme.
Film Artists
Persons engaged in the accountancy profession,Interior decoration,Technical consultancy can also for this scheme.To know more ,click here
Freelancers engaged in the above profession can also opt for this scheme if their gross receipts do not exceed Rs 50 lakhs.
When you are running a small business, you may not have enough resources to maintain proper accounting information and calculate your profit or loss. This makes it difficult to keep track of your income from such a business and find out how much tax you need to pay.
With this in mind the Income Tax Department has laid out some simple provisions where your income is assumed based on the gross receipts of your business. This method is called the presumptive method, where tax is paid on an estimated basis.
From FY 2016-17 onwards, if gross receipts are received through digital mode of payments ,then Net Income is estimated at 6% of such gross receipts and for cash receipts ,rate is same at 8% of such cash receipts.
You don’t have to maintain books of accounts of this business.
Eligibility Criteria for this Scheme
To be eligible for this scheme:
Your gross receipts or turnover of the business for which you want to avail this scheme should be less than Rs 2 crore.
You must be a Resident in India.
This scheme is allowed to an individual, a HUF or a partnership firm. It is not available to a Company.
The taxpayer can voluntarily declare a higher income and pay tax on it. In case the taxpayer chooses to declare lower income than 8% of gross receipts – he shall have to maintain books of accounts and get them audited.
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