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AY 2026-27 · FY 2025-26 · Sugam

ITR-4 (Sugam): The Presumptive Tax Return

ITR-4 is the simplest return for small businesses and professionals who use presumptive taxation — no books, no audit, less paperwork. Here's who can file it for AY 2026-27, the schemes behind it, and where the limits lie.

File ITR-4 with a CA
Quick answer

ITR-4 (Sugam) is for resident individuals, HUFs and firms (other than LLP) with total income up to ₹50 lakh who declare business or professional income on a presumptive basis under Sections 44AD, 44ADA or 44AE. It can also include salary, up to two house properties, interest and small long-term capital gains. The due date for AY 2026-27 is 31 August 2026.

How presumptive works

The three schemes behind ITR-4

Presumptive taxation lets you declare a fixed percentage of turnover or receipts as income — no detailed books, no audit within the limits.

Section 44AD

Small business

Turnover up to ₹2 crore (₹3 crore if cash receipts are 5% or less). Income is taken at 8% of turnover, or 6% for digital / bank receipts.

Section 44ADA

Professionals

Gross receipts up to ₹50 lakh (₹75 lakh if cash receipts are 5% or less). Income is taken at 50% of receipts. For doctors, lawyers, architects, consultants and more.

Section 44AE

Goods carriages

For transporters owning up to 10 goods vehicles. Income is computed per vehicle per month at prescribed rates.

Want to see your presumptive income and tax in seconds? Use the income tax calculator — it has 44AD and 44ADA modes built in.

Go deeper

The detail behind each scheme — and the rules they share

The rates and limits above are only half the story. Each scheme has its own eligibility catch, and all three run on a common set of rules that decide your advance tax, your deductions and whether an audit is triggered.

Section 44AD

What's excluded

44AD is for eligible businesses only. It does not cover:

• Commission or brokerage businesses
• Agency businesses
• Professionals (they use 44ADA)
• Goods-carriage operators (they use 44AE)

You must declare at least 6% (digital) or 8% (cash) of turnover.

Section 44ADA

Specified professions only

Open only to these specified professions:

Legal, medical, engineering, architecture, accountancy, technical consultancy, interior decoration — plus CBDT-notified professions (film artists, authorised representatives, company secretaries).

A general or routine activity that isn't a specified profession may fall under 44AD instead.

Section 44AE

The actual per-vehicle rates

Goods vehicle up to 12,000 kg₹7,500 / month
Heavy goods vehicle (above 12,000 kg)₹1,000 / ton / month

Charged per vehicle, for each month (or part of a month) owned. Example: 5 light vehicles all year = ₹7,500 × 5 × 12 = ₹4,50,000.

The rules that apply to all three schemes

These catch more filers than the rates ever do.

  • Advance tax in one shot. If your tax exceeds ₹10,000, pay 100% by 15 March — a single instalment, not four. Miss it and interest under Section 234C applies.
  • The deemed figure is final. No further claim for expenses or depreciation on top. The only exception: a partnership firm may still deduct partner remuneration and interest under Section 40(b).
  • You can always declare more. The presumptive rate is a minimum — declaring higher actual profit is allowed.
  • Declare less, and audit kicks in. If you show profit below the presumptive rate and your total income crosses the basic exemption limit, you must keep books (Section 44AA) and get a tax audit (Section 44AB).
  • Both regimes work. Presumptive income can be taxed under the new or old regime — but choosing the old regime with business or professional income needs Form 10-IEA filed before the due date.
Eligibility

Who can file ITR-4?

ITR-4 keeps filing simple for small taxpayers on presumptive income. You qualify if all of these fit.

Resident · up to ₹50 lakh

You are a resident individual, HUF or firm (not an LLP), with total income up to ₹50 lakh.

Presumptive business / profession

Your income is declared under 44AD (business), 44ADA (profession) or 44AE (goods carriage).

Plus simple other income

You may also have salary or pension, up to two house properties, and interest income.

Small capital gains, too

Long-term capital gains under Section 112A up to ₹1.25 lakh are allowed, with no losses to carry forward.

When ITR-4 won't do

Who cannot file ITR-4

If any of these apply, ITR-4 is the wrong form — you'll need ITR-3, ITR-2 or another return instead.

  • Total income above ₹50 lakh
  • An LLP, company, or non-resident / RNOR
  • Income from more than two house properties
  • Capital gains beyond ₹1.25 lakh LTCG, or any short-term capital gains
  • A director in a company, or holder of unlisted shares
  • Foreign income, foreign assets or signing authority abroad
  • Turnover or receipts above the presumptive limits
  • Agricultural income above ₹5,000

Cross over a limit mid-year and the right form changes. Not sure? Compare all ITR forms or let us pick it for you.

The presumptive advantage

Earn up to ₹24 lakh — and pay zero tax

Because presumptive taxation counts only a slice of your income, you can keep your declared income at the ₹12 lakh tax-free ceiling of the new regime — while your actual receipts are far higher.

Professionals · 44ADA
₹24,00,000gross receipts
× 50%
₹12,00,000declared income
→
₹0tax payable

Half your receipts count as income. ₹12 lakh is tax-free under the new regime.

Business · 44AD
₹2,00,00,000digital turnover
× 6%
₹12,00,000declared income
→
₹0tax payable

Just 6% of digital turnover counts as income. ₹12 lakh is tax-free under the new regime.

The fine print: figures assume the new tax regime and that this is your only income. The 6% rate applies to digital / bank receipts — for cash it's 8% (so up to ₹1.5 crore turnover stays tax-free). The ₹12 lakh rebate under Section 87A is for resident individuals. You must still file your ITR-4. Check your exact tax in the calculator →

Due date
31 Aug 2026

Non-audit business and professional filers get an extra month — ITR-4 for AY 2026-27 is due 31 August 2026, not 31 July. See all due dates →

The 5-year rule

Once in, stay in

If you opt for 44AD presumptive and then opt out within five years, you cannot use it again for the next five years — and may need audited books in those years. Choose deliberately.

Presumptive made easy

Calculate it, then file it

Income Tax Calculator

Compute presumptive income under 44AD / 44ADA and your tax in seconds.

Calculate my tax →

Income Tax Return filing by CA

We confirm your eligibility, file ITR-4 correctly, and meet the 31 August date.

File my ITR-4 →
Common questions

ITR-4 (Sugam) — Frequently Asked Questions

Everything small businesses and professionals on presumptive income ask before filing for AY 2026-27.

What is ITR-4 (Sugam)?
ITR-4 is the income tax return for resident individuals, HUFs and firms (other than LLP) with total income up to ₹50 lakh who declare business or professional income on a presumptive basis under Sections 44AD, 44ADA or 44AE.
Who can file ITR-4?
Residents with presumptive business or professional income and total income up to ₹50 lakh. The return can also include salary or pension, up to two house properties, interest income, and long-term capital gains under Section 112A up to ₹1.25 lakh.
Can an LLP file ITR-4?
No. LLPs cannot file ITR-4 — they file ITR-5. ITR-4 is only for resident individuals, HUFs and firms other than LLPs.
ITR-3 or ITR-4 — which one?
Use ITR-4 if you opt for presumptive taxation and stay within the limits. If you keep regular books, exceed the presumptive limits, or are not eligible for presumptive, file ITR-3 instead.
What is the turnover limit for ITR-4 under 44AD?
Business turnover up to ₹2 crore, or up to ₹3 crore if cash receipts are 5% or less. For professionals under 44ADA the limit is ₹50 lakh, or ₹75 lakh if cash receipts are 5% or less.
Can I claim expenses on top of the presumptive income?
No. The deemed figure — 8%/6% of turnover, 50% of receipts, or the per-vehicle amount — is treated as final, after all expenses and depreciation. The only exception is a partnership firm, which may still deduct partner remuneration and interest under Section 40(b). Personal deductions such as 80C and 80D remain available under the old regime.
Do I have to pay advance tax under presumptive schemes?
Yes, if your tax for the year exceeds ₹10,000 — but it is simpler: the whole amount is due in a single instalment by 15 March, instead of four. Miss it and interest under Section 234C applies.
Can a salaried person also use a presumptive scheme?
Yes. If you have a side business or profession alongside your salary, you report the salary normally and the business or professional income under the relevant presumptive section in the same return — ITR-4, or ITR-3 if you exceed its limits.
Is a tax audit ever needed under presumptive taxation?
Generally no, if you declare at or above the presumptive rate and stay within the limits. But if you declare a lower profit and your total income crosses the basic exemption limit, maintaining books (Section 44AA) and a tax audit (Section 44AB) become mandatory.
What is the due date for ITR-4 for AY 2026-27?
31 August 2026 for non-audit cases — a month later than the 31 July date for salaried filers. A belated return is possible until 31 December 2026 with late fee and interest.

File ITR-4 the simple way

Running a small business or practice on presumptive income? Send your turnover and receipts on WhatsApp — a CA confirms your eligibility, computes presumptive income, and files ITR-4 before 31 August.

File my ITR-4 with a CA

This guide to ITR-4 (Sugam) is for AY 2026-27 (FY 2025-26) and is for general information only — not tax, legal or financial advice. Eligibility, presumptive rates and limits are governed by the Income-tax Act, 1961 and may change. Verify the correct form and scheme for your facts, or consult a Chartered Accountant, before filing.