Presumptive taxation scheme brings less tension for Small business, Freelancers, Professionals

– The limit of turnover under the presumptive taxation scheme revised from Rs 1 crore to Rs 2 crore for medium or small enterprises. So, anyone with a business of Rs 2 crore can presume that an income of 8% and would not require to maintain books, profit & loss statements or audits.Limit under section 44AD of the Income-Tax Act, under the presumptive method, the tax liability is calculated on the basis of a ‘presumed business income’, irrespective of what your actual income may be.

–  Moreover, Section 44AD now extended to Professionals as well. This frees them from burden of books of accounts and getting audit done. Professionals with gross receipts up to Rs 50 lakh can now avail this benefit by paying tax at 50% of gross receipts.

– This is a significant development for small enterprises and professionals such as lawyers and doctors, interior designers etc. “Instead of filing the cumbersome ITR-4, they can file a much simpler 3-pages long ITR 4S.

For More Details about Sec. 44 AD for Small business and Professionals

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