To adjust the height of the straps, it looks like you need to use the handle at the top of the headrest to move this up and down, this should adjust the straps with it.
I don't think you will want to move the padding, it's usually set at the right place and only detaches to wash it in case your child is sick. Move the headrest so that when your baby is laid in the seat, their head is within the headrest and their shoulders rest just below it.
For a 4 month old, you also need the newborn insert in (according to the instructions, this should stay in until about 9-12 months) and the seat needs to be rear facing in full recline.
To get a snug fit I usually find with this type of seat, you want to loosen the straps and then spend some time placing the baby central in the seat so that their bum is lined up with the bottom strap and their shoulders are resting below the headrest. If the insert is loose and moves around this can make it tricky to get a good fit, that's a problem with some budget type seats. If that's the case just take your time and try to hold the insert in place while adjusting the position of the baby.
Fasten the buckle with the straps loose, and then pull it through from just above the buckle, so that it becomes snug around their waist or hips. With a younger baby sometimes you have to check that their legs/knees aren't getting caught up in it when doing this.
Then once the straps are fitted around the waist, you can pull the long strap at the bottom of the seat, which will pull all the slack through from the shoulder straps. If the pads have very grippy parts on the back of them that catch on clothing, it helps to position these and hold them straight on the baby's chest while you pull the slack through from the straps.
This is a good video showing how to do the loose harness trick to get the straps right - it's a different seat, but the method works the same.