Lawizer

This blog consists of Benefits of Section 44AD, Eligibility Criteria of ITR-4, Presumptive Taxation scheme and Tax saving for small business.

ITR4

Introduction: Purpose Of Section 44AD (Presumptive Taxtation)

Section 44AD is designed to provide an easier way to solve compliance issue that sometimes arises in the business taxpayers by allowing income declaration to fixed percentages.

This is applicable to any business except to any agency business or brokerage business.

This section entails about maintaining detailed books of account that provides presumptive taxation scheme for small taxpayers.

The Tax is payable in one installment by 15th march.

Key Benefits

The tax issues gets simplified.
There is no such requirement for tax audit under section 44AB.

Eligibility Criteria Of ITR-4

A Resident individual, HUFs can file ITR-4 if the following conditions are fulfilled:

The income must not exceed Rs50 lakh during the financial year.
The income is applied on the basis of the presumptive basis under SECTION 44AD.
In case of long term capital gains the amount must not exceed beyond Rs 1.25 lakh.
Income from salary or pension or own house property is allowed about Rs 5000.

Presumptive Taxation Scheme

It is given as a relief to small taxpayers from the tedious job of maintenance of book of account.

It is framed under the Presumptive Taxation Scheme under Section 44ADA and 44AE of the Income Tax Act, 1961.

Eligibility Criteria For Presumptive Taxation In India

Legal
Medical
Engineering
Technical Consultancy
Architecture
Other Professions By CBDT

Sec 44AD For Professional

This is applicable to 8% of the turnover or gross receipt of the eligible business during the financial year which is amount to the total taxable income.

In order to promote digital transaction and encourage small business to accept digital payments, income shall unorganized business to accept digital payments.

Therefore the income will be compute to the 6% interest and 8% turnover.

Tax Saving For Small Business

Income Tax can be saving in small business if it is well planned practically.

By leveraging the business into deduction to reduce tax income.
By depreciating the cost of assets.
By strategically managing the travel expenses and other travel expenses.
By investing in medical insurance this reduces the tax deduction.
By advertisement like through Digital Marketing , it plays an effective role in tax – deductible.
By donating funds in charitable organization.

Conclusion

This concludes that ITR-4 promotes in ease for filing, time efficiency and simplified tax compliance for small business and hereby if an individual opts for the presumptive taxation scheme under Section 44AD this becomes easier and promotes less compliance issue.

Simplify Your Taxes, Amplify Your Savings. Why drown in bookkeeping when you can use Presumptive Taxation?

If you are a small business owner, Section 44AD is your golden ticket to easier compliance and lower tax burdens.

We specialize in helping small businesses file ITR-4 (Sugam) correctly to ensure you never pay a penny more than needed.

Start Your ITR-4 Filing & Save on Taxes Today

Frequently Asked Questions

What is the maximum income limit to file ITR-4?

A: The maximum amount should not exceed to Rs50 lakh in the financial year.

Is salary income allowed in ITR 4?

A: Yes, they are allowed from salary/pension.

Is agricultural income allowed in ITR-4?

A: Yes, agriculture income is up to Rs 5000 can be allotted.

Are professionals like doctors or lawyers file ITR-4?

A: YES, only if they opt that under section 44ADA.