44 ad - presumptive tax
This query is : Resolved
10 March 2016
there was a query for Section 44AD -which no one is able to answer satisfactorily
if I have an eligible trading (plastics) business with turnover below 1 Cr
Q1: whether i can declare profit @ 8% even though my actual margin may be say 50%
if all sales receipts -(say 99 lacs) are by cheque and all purchase payments (say 50 lacs) are by cheque and other admin expenses (say 5 lacs) are also by cheque
so total net profit accumulated in bank is Rs. 44 lacs
Q2: since in above -case i have declared profit @ 8% -say Rs. 8 lacs and assets showing in my bank - Rs. 44 lacs - can AO - add 36 lacs (44-8) as assets disproportionate to income
Q3: whether it is an OBLIGATION to declare higher income - if I am maintaining books of accounts for other purposes; and profit as per my books is higher than presumptive income
Kindly see if you can take time to answer above query when you are free
Thanks for your time
if I have an eligible trading (plastics) business with turnover below 1 Cr
Q1: whether i can declare profit @ 8% even though my actual margin may be say 50%
if all sales receipts -(say 99 lacs) are by cheque and all purchase payments (say 50 lacs) are by cheque and other admin expenses (say 5 lacs) are also by cheque
so total net profit accumulated in bank is Rs. 44 lacs
Q2: since in above -case i have declared profit @ 8% -say Rs. 8 lacs and assets showing in my bank - Rs. 44 lacs - can AO - add 36 lacs (44-8) as assets disproportionate to income
Q3: whether it is an OBLIGATION to declare higher income - if I am maintaining books of accounts for other purposes; and profit as per my books is higher than presumptive income
Kindly see if you can take time to answer above query when you are free
Thanks for your time
10 March 2016
1. That is why govt says 44AD is optional.
2. AO can add as unexplained investment.
3. Becomes obligation in view of 1 and 2 above.
2. AO can add as unexplained investment.
3. Becomes obligation in view of 1 and 2 above.
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