16 March 2014
Please help me know that which Form of return .i.e. either ITR 4 or ITR 4s is to be filed for an assessee with business income & 2-3 house property income & other income.
Also, if such assessee had a Tax audit u/s 44ab in the previous year (2012-2013) then is such assessee necessitated to use digital signature for its ITR return to be filed u/s 44ad, during this current year for current financial year of 2013-2014.
Further, can such assessee get deductions u/s 80C & deduction for interest on housing loan, if she files return u/s 44ad.
28 June 2014
which ITR form is applicable to assessee having presumptive income along with more than one house property income.
Also, please let me know that will there be any tax complications, if the total income after deducting exempt income becomes less than 8% of turnover,under computation of income.
28 June 2014
which ITR form is applicable to assessee having presumptive income along with more than one house property income.
Also, please let me know that will there be any tax complications, if the total income after deducting exempt income becomes less than 8% of turnover,under computation of income.
02 August 2024
For an assessee with business income under section 44AD, rental income from house properties, and other income, here's a breakdown of the relevant ITR form and related details:
### **1. Applicable ITR Form**
- **ITR-4 (SUGAM)**: This form is used for individuals, Hindu Undivided Families (HUFs), and businesses (other than those opting for section 44AD or section 44AE). It’s simpler and meant for those who meet specific criteria and don’t need to provide detailed accounts.
- **ITR-3**: This form should be used if the assessee has income under **section 44AD** and also has income from house property, or other sources (e.g., interest income). ITR-3 accommodates detailed disclosures and additional sources of income, which suits your scenario with multiple house properties.
Since you mentioned: - Business income under section 44AD - Income from house properties - Other sources of income
**ITR-3** is more appropriate for this situation. It allows you to declare business income under section 44AD and provides sections to report income from house property and other sources.
### **2. Digital Signature Requirement**
- **Tax Audit Requirement**: If the assessee was subject to tax audit under section 44AB in the previous year (e.g., AY 2012-13), the digital signature requirement applies to the current year’s return as well.
- **Filing Without Audit**: If the tax audit was not required for the current year (e.g., AY 2013-14), the use of a digital signature is not mandatory but can be used if the assessee prefers or if the form requires it.
### **3. Deductions Under Section 80C and Housing Loan Interest**
- **Section 80C Deductions**: These deductions are available regardless of whether the income is computed under section 44AD. You can claim deductions for investments in specified financial instruments like Life Insurance Premium, Provident Fund, Equity-linked Savings Scheme (ELSS), etc.
- **Interest on Housing Loan**: Similarly, you can claim deductions for interest on housing loan under section 24(b).
### **4. Tax Complications Related to Presumptive Income**
- **Minimum Taxable Income**: Under section 44AD, if the declared income is less than 8% of the turnover (or 6% for digital transactions), it might raise queries with the Income Tax Department. The income needs to be declared correctly, and if it is less, ensure to justify or provide an explanation if queried.
- **Tax Complications**: It is important to maintain accurate records and ensure the presumptive income is reasonable. If the actual income is less than 8% of turnover, you should be prepared to explain and substantiate your income with proper documentation.
### **Summary**
1. **Form to Use**: Use **ITR-3** for reporting income under section 44AD along with other sources of income like house property. 2. **Digital Signature**: Not mandatory unless a tax audit was required in the previous year; however, it’s advisable to use it if the tax audit was applicable. 3. **Deductions**: You can claim deductions under section 80C and for interest on housing loans irrespective of the presumptive income provisions. 4. **Tax Complications**: Be prepared to justify the income if it is less than the prescribed percentage of turnover.
Ensure accurate reporting and maintain proper documentation to support all the figures and claims made in the tax return.
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