Switch over from ITR 3 to ITR 4

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A user is asking if their friend can switch back to filing their income tax return using ITR 4 for FY 2021-22, after having used ITR 3 for FY 2020-21. The advice given is that if the friend is eligible for presumptive assessment, they can file a belated return using ITR 4. However, if they previously opted for Section 44AD for business income, they generally need to continue with it for five years to avoid potential audit liabilities.

Gopalakrishnan. S

Gopalakrishnan. S (Querist)
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29 December 2022 Sir,

One of my friend has been filing IT return using ITR 4 for the FY 2018 - 19 and 2019 - 20
and filed IT return using ITR 3 for the FY 2020 - 21. Now, can he use ITR 4 to file his return
for the current FY ( 2021 - 22) ? What will be the consequences, if he switch overs from
ITR 3 to ITR 4 now ?

Pls. Advice.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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29 December 2022 If he is eligible to file ITR under presumptive assessment, he can file belated return for current year in form ITR 4.
If he is opting for sec. 44AD for business income declaration, then he should continue to same regime for next five years, otherwise audit liability may get attracted.

Gopalakrishnan. S

Gopalakrishnan. S (Querist)
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29 December 2022 Thank you very much Sir.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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29 December 2022 You are welcome ..

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