As per the Section 44 AD, Section 44 ADA, and Section 44 AE of the Income Tax Act, a tax- payers are eligible to opt for presumptive income scheme as per their business requirement or the form of business. The scheme allows a tax payer to compute annual taxable amount on a presumed income basis instead of an actual earnings. Individuals, Professionals, and Hindu Undivided Families (HUF’s) who have opted for presumptive income scheme are obliged to use Form ITR- 4 SUGAM for filing their annual Income Tax Returns (ITR).
Any individual or HUF can opt for presumptive income scheme based on their respective annual income. In case of a business entity the annual income shall not exceed INR 2 Crores, while professionals can go for presumptive income scheme when their yearly receipts exceed INR 50 Lacs.
Following sources of income are taken into consideration while computing the annual taxable amount:
As per the Income Tax Department’s (ITD) guidelines, all individuals who need to file Form ITR- 4 SUGAM must complete the mandated statutory formalities of filing annual ITR by July 31st and in case of business September 30th is the due date for filing annual ITR.
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