About Presumptive Basis Income Under Section 44AD and Section 44ADA under Income Tax Act
Section 44AD
- If the Assessee adopts/choose ITR under section 44AD then he has to file ITR under this for consecutive 5 years.
Otherwise, for example, if assessee file ITR under this for 2 years and the series then he could not take the benefit of it, as you are disqualified from 5 consecutive years. - ITR 4 is to fill under presumptive scheme rather than ITR 3 which is wide and complicated
- Applicability of this is for Individual, Hindu Undivided Family (HUF), and Partnership firm.
- This is not applicable to Company and LLP.
- Payment of Advance tax is not required in the presumptive basis scheme.
- Audit and Maintaining of books of Accounts are not required under this.
- It is applicable to 2 cr turnover
- For the business like Commission and Brokerages, Plying and Hiring of carriage of goods ..this is not applicable.
- We have to declare Profit minimum of 8 % for cash base business whereas 6% for digital mode.
Section 44ADA
- This section is applicable to professionals. i.e. Accounting, Legal, Engineering, Architectural, Medical, Technical Consultant or Interior Business.
- In this, the limit is 50 lakh.
- We have to declare Profit minimum of 50%.
