ITR-4 Sugam Filing
Presumptive income, without detailed books.
Presumptive taxation lets a small business or professional declare a fixed percentage of turnover as profit and skip both detailed books and the tax audit. Section 44AD applies to business at 8% of turnover, or 6% on digital receipts; 44ADA applies to specified professionals at 50% of gross receipts; 44AE applies to goods carriage operators per vehicle.
The turnover limits are ₹2 crore for 44AD, extended to ₹3 crore where cash receipts stay under 5%, and ₹50 lakh for 44ADA, extended to ₹75 lakh on the same condition.
There is a lock-in worth knowing about. Opt out of 44AD after opting in and you cannot return for five years, and you become liable to audit in the meantime if income exceeds the exemption limit.
What is included
- Eligibility and the better scheme identified
- Presumptive income computed against actual margin
- Advance tax position checked — one instalment by 15 March
- Filed and e-verified
What we need from you
- Turnover and gross receipts for the year
- Bank statements showing digital versus cash receipts
- Details of vehicles, for 44AE
- Form 26AS and the AIS
Questions
Is presumptive taxation always better?
Not if your actual margin is below the presumptive rate — declaring 8% when you earned 3% means paying tax on profit you never made. It is better when your real margin is at or above the rate and you value not maintaining books.
Also in Income tax
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