ITR · Glossary
ITR-4 (Sugam)
Income tax return form for individuals on presumptive taxation (44AD/44ADA/44AE).
ITR-4 Sugam, notified annually under Rule 12 of the Income Tax Rules, 1962, is the shortest ITR form, designed for residents under presumptive taxation. Eligibility: resident individual/HUF/partnership firm (non-LLP), total income up to Rs. 50 lakh, presumptive income only, at most one house property, no capital gains, no foreign assets/income, not a company director, not holding unlisted equity.
Deadline: 31 July of the assessment year (no audit). Most Indian freelancers qualify and should use ITR-4 unless they have capital gains or income above Rs. 50 lakh.
Worked example
Priya files ITR-4 for FY 2026-27 by 31 July 2027 reporting Rs. 24L gross receipts, Rs. 12L deemed income under 44ADA. With 87A rebate, tax due = zero — but TDS of Rs. 1.2L deducted by clients is refundable. Refund usually credits within 30-60 days of filing.
Practitioner tip
You can file ITR-4 even if your gross receipts are well under Rs. 50L — Rs. 50L is the *upper* ceiling, not the floor. A Rs. 8L freelancer is a textbook ITR-4 candidate.
Frequently asked
- I sold mutual funds during the FY. Can I still file ITR-4?
- No — any capital gain (even Rs. 1) disqualifies ITR-4. Switch to ITR-3 for that year. You can return to ITR-4 the next year if the capital gain does not repeat.
- Do I need to maintain books under ITR-4?
- No — that's the headline benefit of presumptive taxation. Section 44AA(1) book-keeping requirements don't apply when you declare income under 44AD/44ADA/44AE. But hold onto bank statements + invoices + 26AS for 7 years (the audit limitation under Section 149).
Manage this in HourSlip
HourSlip exports your ITR-4 data pre-filled →Related glossary terms
- ITR-3 — Income tax return form for taxpayers with business/profession income who do not use presumptive taxation.
- Section 44ADA — Presumptive taxation scheme for specified professionals — 50% of gross receipts is deemed profit.
- Presumptive Taxation — Tax scheme where profits are presumed at a fixed percentage of receipts, no books required.
Sources
These definitions are educational. Tax laws change annually — verify with a Chartered Accountant before making GST or income-tax decisions.