About Presumptive Basis Income Under Section 44AD and Section 44ADA under Income Tax Act

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%.