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Who can file ITR-4 Sugam for AY 2026-27?
ITR-4 Sugam is a simplified return for eligible taxpayers who choose presumptive taxation. It is not the default form for every business owner, freelancer, or professional.
Current rule focus: ITR-4 is for eligible presumptive-income cases under sections 44AD, 44ADA, or 44AE. If your books, audit requirement, losses, or business facts do not fit the presumptive scheme, review ITR-3 instead.
Who can use ITR-4?
For AY 2026-27, ITR-4 can generally be used by a resident individual, resident HUF, or resident firm other than LLP when:
- Total income does not exceed Rs. 50 lakh.
- Business or professional income is computed on a presumptive basis under section 44AD, 44ADA, or 44AE.
- The return may also include salary or pension, income from up to two house properties, agricultural income up to Rs. 5,000, eligible long-term capital gain under section 112A up to Rs. 1.25 lakh, and eligible other-source income.
Presumptive-income thresholds
- Section 44AD: for eligible businesses, the turnover/gross receipts limit is generally Rs. 2 crore, or Rs. 3 crore where the specified cash-receipt condition is satisfied.
- Section 44ADA: for eligible professionals, the gross receipts limit is generally Rs. 50 lakh, or Rs. 75 lakh where the specified cash-receipt condition is satisfied.
- Section 44AE: for eligible goods carriage businesses, subject to vehicle and income computation conditions.
Who cannot file ITR-4?
- NRIs and residents but not ordinarily resident.
- Individuals, HUFs, or firms with total income above Rs. 50 lakh.
- LLPs and companies.
- Taxpayers with short-term capital gains or long-term capital gain under section 112A above Rs. 1.25 lakh.
- Taxpayers with foreign income, foreign assets, or signing authority outside India.
- Directors in a company or taxpayers who held unlisted equity shares during the year.
- Cases with brought-forward losses or losses to be carried forward.
- Lottery, racehorse, special-rate income, or income outside the ITR-4 eligibility conditions.
Documents to keep ready
- PAN, Aadhaar, bank details, and GST details where applicable.
- Sales/receipts summary, bank statements, UPI/payment gateway statements, and expense records.
- Form 26AS, AIS, TIS, TDS certificates, advance tax and self-assessment tax challans.
- Form 16, rent, home loan, and deduction proofs if salary or house property income is also included.
How All India ITR helps
Our experts help identify whether ITR-4 is actually suitable, estimate presumptive income, reconcile AIS/26AS, check Form 10-IEA implications where relevant, and prepare the return for e-filing.
Get expert help with presumptive ITR filing
Frequently Asked Questions
Q. Is ITR-4 mandatory for every small business?
No. ITR-4 is optional and available only where the taxpayer is eligible and chooses presumptive taxation.
Q. Can I claim business expenses separately under ITR-4?
Under presumptive taxation, income is declared at prescribed rates and the law deems eligible business expenses to have been considered. Review your facts before choosing this scheme.
Q. Can ITR-4 include house property income?
Yes, subject to the current ITR-4 eligibility rules, AY 2026-27 permits reporting income from up to two house properties.
This guide is reviewed for AY 2026-27. Presumptive taxation has eligibility conditions and exceptions; take expert help where turnover, receipts, losses, GST, or audit facts are unclear.
