Itr 4s regarding ay 2015-16

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

26 June 2015 Dear Sir,
One of the assessee has net profit Rs. 165000/- u/s 44ad and besides this he has rental income of 13500/- per month by letting a shop for ATM. In this regard I have following queries -
1. Whether he can use itr 4S to show his business income and rental income as well.
2. What % of deduction is allowed out of rental income as annual maintenence?

Please clarify.
Thanks and Regards.

CS Advocate Abhishek Goyal

CS Advocate Abhishek Goyal (Expert)

26 June 2015 30% deduction is allowed as standard deduction for repairs u/s 24(b).

Querist : Anonymous

Querist : Anonymous (Querist)

27 June 2015 Whether itr 4S will work?

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)

02 August 2024 For the assessment year 2015-16, **ITR-4S** (also known as ITR-4S) is designed for taxpayers who are eligible for the presumptive taxation scheme under Section 44AD. This form is used for businesses and professions where the turnover is less than ₹60 lakh and for which books of accounts are not required to be maintained under this scheme.

### 1. **Eligibility to Use ITR-4S**

**a. Business Income:**
- **Yes**, the income under Section 44AD (presumptive taxation) can be reported using ITR-4S. This is suitable if the taxpayer's business turnover is less than ₹60 lakh and they are opting for the presumptive taxation scheme.

**b. Rental Income:**
- **No**, ITR-4S is not suitable for reporting rental income. Rental income should be reported in a form that supports such income, like ITR-3. ITR-4S does not accommodate additional income from sources like rental income from property.

### 2. **Deduction for Rental Income**

For rental income, the following deductions are typically allowed:

- **Standard Deduction**: Under Section 24(a) of the Income Tax Act, a standard deduction of 30% of the rental income is allowed for repairs and maintenance of the property.

- **Other Deductions**: Additionally, if there is any interest on loans taken for the property, it can be claimed under Section 24(b).

### **Suggested Approach**

Since ITR-4S does not support rental income, you should use **ITR-3** for reporting both:

1. **Business Income under Section 44AD**: You can report your presumptive business income and claim the benefits of presumptive taxation.

2. **Rental Income**: You should report the rental income from the shop under the head "Income from House Property" in ITR-3.

**To summarize:**

1. **ITR-4S**: Use this form only to report business income under Section 44AD if you do not have any other type of income.

2. **ITR-3**: Use this form to report both business income under Section 44AD and rental income. You can claim the standard deduction of 30% on the rental income and any other eligible deductions.

### Filing Instructions:

1. **For Business Income**:
- Report under the "Presumptive Business Income" section in ITR-3.

2. **For Rental Income**:
- Report under the "Income from House Property" section in ITR-3.
- Apply the 30% standard deduction on the gross rental income and any other allowable expenses.

**Conclusion**: Use **ITR-3** for a taxpayer with both presumptive business income under Section 44AD and rental income. Ensure to apply the correct deductions for rental income and maintain the appropriate records.

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