Section 44AD (Presumptive Tax for Businesses) Linkage with Tax Audit u/s 44AB (With Examples)

Section 44AD (Presumptive for Businesses) Linkage with Tax Audit under section 44AB (With Examples) discussed by CA. (IP) Vivek Khurana.
A Practical Analysis of Section 44AD of Income Tax Act, 1961 (Presumptive Taxation) along with Section 44AD of Income Tax Act, 1961 (Tax Audit).
- Is section 44AD applicable to profession?
- Who are eligible to opt for section 44AD?
- Section 44AD : Relaxation or Hardship?
- To whom disqualification u/s 44AD is applicable?
- Is an audit necessary if a person opts out of Section 44AD?
- Can I show higher income under section 44AD?
- Are we really aware of Section 44AD?
- Consistency : A major requirement of section 44AD
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• Section 44AD (Presumpt...
Special provision for computing profits and gains of business on presumptive basis.
- Section 44AB vs 44AD - Presumptive Taxation (With Examples),
- Section 44AB vs 44AD- Tax Audit & Presumptive Taxation,
Is tax audit applicable for 44AD?,
Who is liable for 44AB?,
What is Section ,44AD of income tax?,
What is Section 44AD? Features, Example & FAQs
FAQs on Introduction & Applicability of Tax Audit,
Tax on presumptive basis in case of certain eligible businesses,
What is Section 44AD?,
Who is eligible for 44AD?,
What is 6% and 8% in 44AD?,
How do I calculate 44AD income?,
Check Features & Applications of Section 44AD,
Section 44AD of Income Tax Act,
Presumptive Taxation Under Section 44AD of Income Tax Act,
Whether audit of accounts under clause (d) & (e) of section 44AB read with section 44AD & 44ADA of the IT Act is compulsory for an assessee?,
Analysis of Recent Amendments in Section 44AB & 44AD,
Interplay of Sec 44AA 44AB and 44AD of the Income Tax Act 1961,
Applicability of Tax Audit under section 44AB or 44AD,
All about section 44AD- No books of account & audit,
An insurance agent cannot adopt the presumptive taxation scheme of section 44AD:
A person who is earning income in the nature of commission or brokerage cannot adopt the presumptive taxation scheme of section 44AD. Insurance agents earn income by way of commission and, hence, they cannot adopt the presumptive taxation scheme of section 44AD.
A person engaged in a profession as prescribed under section 44AA(1) cannot adopt the presumptive taxation scheme of section 44AD:
A person whose total turnover or gross receipts for the year exceed Rs. 2,00,00,000 cannot adopt the presumptive taxation scheme of section 44AD:
The presumptive taxation scheme of section 44AD can be opted by the eligible persons, if the total turnover or gross receipts from the business do not exceed Rs. 2,00,00,000. In other words, if the total turnover or gross receipt of the business exceeds Rs. 2,00,00,000 then the scheme of section 44AD cannot be adopted.
No need to maintain books of account as prescribed under section 44AA:
Section 44AA deals with provisions relating to maintenance of books of account by a person engaged in business/profession. Thus, a person engaged in business/profession has to maintain books of account of his business/profession according to the provisions of section 44AA.
Consequences if a person opts out from the presumptive taxation scheme of section 44AD:
If a person opts for presumptive taxation scheme then he is also require to follow the same scheme for next 5 years. If he failed to do so, then presumptive taxation scheme will not be available for him for next 5 years. [For example, an assessee claims to be taxed on presumptive basis under Section 44AD for 2021-22. However, for AY 2022-23, if he did not opt for
presumptive taxation Scheme. In this case, he will not be eligible to claim benefit of presumptive taxation scheme for next five AYs, i.e. from AY 2023-24 to 2027-28.]
Further, he is required to keep and maintain books of account and he is also liable for tax audit as per section 44AB from the AY in which he opts out from the presumptive taxation scheme. [If his total income exceeds maximum amount not chargeable to tax]
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