Accounting made simple
Running a small business or practice is hard enough without complex ledgers. The presumptive scheme lets you file the simpler ITR-4 (Sugam) by declaring a fixed percentage of receipts as profit.
How it works
Section 44AD lets eligible businesses declare 8% of cash and 6% of digital receipts as profit (turnover up to Rs 2 crore, or Rs 3 crore if 95% digital); Section 44ADA lets professionals declare 50% (receipts up to Rs 50 lakh, Rs 75 lakh if 95% digital) (Source: Income Tax Act, Sections 44AD and 44ADA).
| Scheme | Profit declared | Limit |
|---|---|---|
| 44AD (business) | 8% cash / 6% digital | Rs 2 cr / Rs 3 cr |
| 44ADA (profession) | 50% | Rs 50 / Rs 75 lakh |
The catch
If you opt in, you cannot separately claim business expenses like rent or laptop depreciation; the scheme assumes the rest covers them.
When ITR-4 is not allowed
- Capital gains (sold stocks or property).
- More than one house property.
- Foreign assets or foreign income.
File it (portal path)
- Log in at incometax.gov.in and start ITR-4.
- Enter turnover/receipts and the presumptive profit.
- Pay any tax via e-Pay Tax, then submit and e-verify.
What you should do
Compare your real margin to the presumptive rate. If your actual profit is much lower and you keep books, ITR-3 may be cheaper.
Common mistake
Choosing 44AD then also claiming expenses. The scheme bundles expenses into the presumed profit.
How LastMinute ITR helps
LastMinute ITR's checklist confirms your eligibility so your ITR-4 filing on the portal is clean. Start at /file, import at /file/import/documents, and reconcile at /file/import/mismatch.
LastMinute ITR is a companion tool, not affiliated with the Income Tax Department. You file and e-verify your return yourself on incometax.gov.in.