Compliance
ITR form for doctors: ITR-3 or ITR-4 (Sugam)? Who can file ITR-4 under 44ADA, who must file ITR-3, when a tax audit applies, and the 2026 transition to new forms.
Every year a doctor's CA picks one of two forms, and every year a few doctors pick the wrong one themselves on the portal and get a defect notice. The choice turns on three things: whether you declare income under the presumptive scheme, whether your total income is above ₹50 lakh, and a short list of disqualifications such as being a company director.
Published · Last reviewed · 5 min read
- ITR-4 (Sugam) is for a resident individual, HUF or firm (other than an LLP) declaring business or professional income on a presumptive basis under section 44AD, 44ADA or 44AE, with total income up to ₹50 lakh. It is optional.
- A doctor with practice income who is not on the presumptive scheme, or is disqualified from ITR-4 (total income above ₹50 lakh, a company directorship, unlisted shares, foreign assets, brought-forward losses, among others), files ITR-3.
- A tax audit is needed when professional receipts exceed ₹50 lakh and profit is not declared under the presumptive scheme, or when profit is declared below 50% and income exceeds the basic exemption: section 63 and section 58(3) of the Income-tax Act, 2025 (old 44AB).
A resident doctor who declares income under the presumptive scheme for professionals (section 44ADA of the 1961 Act, section 58(2) of the 2025 Act) and whose total income is ₹50 lakh or less can file ITR-4 (Sugam). A doctor with income from practice who is not on that scheme, whose total income is above ₹50 lakh, or who falls in one of ITR-4's exclusions, files ITR-3. A salaried doctor with no practice income at all uses ITR-1 or ITR-2 instead.
Which forms apply this year?
2026 is a transition year. The Income Tax Department's FAQ says the return for income earned in FY 2025-26 is filed for assessment year 2026-27 "under the provisions of the Income Tax Act, 1961", using the existing ITR forms. For tax year 2026-27 (April 2026 to March 2027), "The new ITR forms under the Income Tax Rules, 2026 will be notified by the Government well before the due dates". The rules below are the Department's rules for AY 2026-27. Check the portal's form page when the tax year 2026-27 forms are notified, since eligibility can change.
Who can file ITR-4 (Sugam)?
The Department's page on returns applicable for AY 2026-27 says ITR-4 is for a resident individual or HUF (other than not ordinarily resident) or a resident firm (other than LLP) whose business or professional income is "computed on a presumptive basis (u/s 44AD / 44ADA / 44AE of Income Tax Act,1961)", with total income not exceeding ₹50 lakh. It can also carry salary or pension, one house property, other sources, agricultural income up to ₹5,000 and long-term capital gains under section 112A up to ₹1,25,000. The page says ITR-4 is used "at his option".
| You cannot file ITR-4 if you | Common doctor case |
|---|---|
| Have total income above ₹50 lakh (excluding section 112A gains up to ₹1,25,000) | Practice income plus hospital salary and interest crossing ₹50 lakh |
| Are a director in a company | Director of a diagnostic centre or hospital company |
| Have held unlisted equity shares | Shares in a private hospital company |
| Have short-term capital gains, or section 112A gains above ₹1,25,000 | Selling mutual funds or shares in the year |
| Have assets or signing authority outside India, or income from outside India | Foreign bank account from training years |
| Have deferred tax on ESOPs, or brought-forward or carry-forward losses under any head | Loss carried from an earlier year of practice |
When must a doctor file ITR-3?
The same Department page describes ITR-3 as the form for individuals and HUFs with income under profits or gains of business or profession who are "Not eligible to file ITR-1, ITR-2 or ITR-4". For a doctor that means:
- Practice income computed on actual profit from books, not under section 44ADA.
- Presumptive income, but total income above ₹50 lakh or any ITR-4 exclusion above.
- Receipts above the presumptive limits (₹50 lakh, or ₹75 lakh where cash is 5% or less of receipts).
- Profit claimed below 50% of receipts in a year, which also brings books and an audit (see below).
A firm that cannot use ITR-4, such as an LLP or a firm off the presumptive scheme, files the firm form listed on the portal's Firm/LLP page; we have not covered it here.
When does a doctor need a tax audit?
Section 63(1) of the Income-tax Act, 2025 (old 44AB) requires a person "carrying on profession" to have the accounts audited "if his gross receipts in profession exceed fifty lakh rupees in any previous year" (Table, Sl. No. 1(c)). Section 63(2) switches the section off "where profits and gains of business or profession, declared by the assessee are as per section 58(2)". And section 58(3) works the other way: a presumptive doctor who claims actual profit lower than 50%, with total income above the amount not chargeable to tax, "shall be required to" keep books under section 62 and get them audited under section 63.
| Situation | Books | Audit | Form | Return due date |
|---|---|---|---|---|
| Receipts up to ₹50 lakh (or ₹75 lakh with cash 5% or less), profit declared at 50% or more, total income up to ₹50 lakh | Not under section 62 while on section 58(2) | No (section 63(2)) | ITR-4, optional | 31 August |
| Same, but total income above ₹50 lakh or an ITR-4 exclusion | Not under section 62 while on section 58(2) | No | ITR-3 | 31 August |
| Off the presumptive scheme, receipts up to ₹50 lakh | Yes, section 62(1)(a) | No | ITR-3 | 31 August |
| Off the presumptive scheme, receipts above ₹50 lakh | Yes | Yes, section 63, Sl. No. 1(c) | ITR-3 | 31 October |
| On section 58 but claiming profit below 50%, income above basic exemption | Yes, section 58(3) | Yes, section 58(3) and section 63, Sl. No. 2 | ITR-3 | 31 October |
The due dates come from section 263(1)(c) of the 2025 Act as substituted by section 66 of the Finance Act, 2026: 31 October where accounts must be audited, 31 August for a person with business or professional income whose accounts need no audit, and 31 July for others. The audit report itself is due one month before the return due date (section 63(5)(a)). For AY 2026-27 under the old Act, the Department's ITR-4 page gives 31 August 2026 as the ITR-4 due date.
What books a doctor must keep off the presumptive scheme is in our post on books of account for doctors, and the presumptive limits and regimes are in our post on income tax for doctors under the 2025 Act.
What to check before you file
- Gross receipts for the year, from the clinic's billing record and bank account, matched to each other.
- Cash share of receipts, which decides whether your presumptive limit is ₹50 lakh or ₹75 lakh.
- TDS on hospital and consultant fees against the tax credit statement for your PAN.
- Any directorship, unlisted shares, foreign account or loss carried forward, which rule out ITR-4.
- Advance tax paid by 15 March, covered in our post on advance tax for doctors.
Questions
Can a doctor file ITR-4 under 44ADA?
Yes, if the doctor is resident, declares income under section 44ADA (section 58(2) of the 2025 Act), has total income up to ₹50 lakh and is not in any of the exclusions the Income Tax Department lists, such as being a company director or having brought-forward losses.
Is ITR-4 compulsory for a 44ADA doctor?
No. The Department's page says an eligible person files ITR-4 "at his option". ITR-3 can be used instead.
Does a doctor with receipts above ₹50 lakh need an audit?
Only if profit is not declared under the presumptive scheme. Section 63(2) of the 2025 Act removes the audit where profits are declared under section 58(2), which allows receipts up to ₹75 lakh when cash is 5% or less of receipts.
Sources
- Income Tax Department, e-filing portal, Return / Forms applicable to me (Individual), AY 2026-27 (accessed 30 Oct 2026)
- Income Tax Department, e-filing portal, File ITR-4 (Sugam) Online, AY 2026-27 (accessed 30 Oct 2026)
- Income Tax Department, e-filing portal, Income Tax Returns FAQ (Income Tax Act 2025), FAQs 3 to 11 (accessed 30 Oct 2026)
- Ministry of Law and Justice, The Income-tax Act, 2025 (No. 30 of 2025), Gazette of India Extraordinary, 21 August 2025: sections 58, 62, 63, 263 (accessed 30 Oct 2026)
- Ministry of Law and Justice, The Finance Act, 2026 (No. 4 of 2026), Gazette of India Extraordinary, 30 March 2026: section 66 (accessed 30 Oct 2026)
This is operational guidance for clinics, not legal or tax advice. Confirm with your state authority, council or CA.
Drafted with AI assistance; every fact checked against the sources listed; reviewed by the Vitels team.