ITR filing for business owners and proprietors

• Sole proprietors: traders, shop owners, wholesalers, manufacturers and small service businesses
• GST-registered businesses that want the ITR turnover matched with GST returns
• Business owners who also have salary, rent, interest or capital gains
• F&O and intraday traders: we file these too, under the F&O plan (see our F&O and intraday tax guide)
• Freelancers and professionals have their own pages: freelancers and professionals
• Partnership firms and LLPs file ITR-5, and companies file ITR-6. Ask us about these.

ITR-1 and ITR-2 cannot be used if you have business income. More detail: ITR-3 guide and which ITR form to file.

• For a resident individual, HUF or partnership firm (not an LLP) with turnover up to ₹2 crore, or up to ₹3 crore if cash received is not more than 5% of turnover.
• Income is taken as 8% of turnover, or 6% of the turnover received by account payee cheque, bank draft or electronic modes.
• No books or tax audit are needed while you declare income under 44AD.
• If you leave 44AD in any of the five years after using it, you cannot use it again for the next five years.
• Advance tax: pay the whole amount by 15 March.

Full rules: our presumptive taxation guide.

• Business turnover above ₹1 crore in the year, or above ₹10 crore if cash receipts and cash payments are each not more than 5% of the total.
• Not if you declare income under 44AD(1).
• Also if you left 44AD within the five-year period and your income is above the exemption limit.

A tax audit is a separate service: see tax audit and our tax audit guide.

• Work out your business profit from sales, purchases and expenses, from your books, P&L and balance sheet. Bookkeeping is a separate service.
• On the Presumptive plan, check whether 44AD suits you before we file.
• Match the turnover in your ITR with your GST returns. ITR-4 asks for your GSTIN and the turnover in your GST returns.
• Work out your tax in the old and the new regime.
• Add salary, rent, interest and capital gains.
• File the return and help you e-verify it.
• If you get a simple notice or a correction notice on a return we filed, we reply to it for free.

The new regime is the default. If you have business income and want the old regime, you must opt out on or before the due date of the return. That choice carries on to later years, and you can come back to the new regime only once (unless your business income stops). We work out your tax both ways first.

If you file late:

• Late fee under section 234F: ₹5,000, or up to ₹1,000 if your total income is not more than ₹5 lakh.
• Interest under section 234A: 1% a month or part of a month on tax still unpaid. Short advance tax also brings interest under sections 234B and 234C.
• A business loss cannot be carried forward if the return is late.

As of 10 October 2026 we have not found any extension of the 31 August 2026 date. Read more in our late fee and belated return guide.

• Showing a turnover in ITR-4 that does not match your GST returns.
• Leaving 44AD and then wanting it back within five years.
• Filing late with a business loss. The loss cannot be carried forward.
• Skipping advance tax. Interest under sections 234B and 234C follows.
• Using ITR-1 or ITR-2 when you have business income.