44AD

This query is : Resolved

CA Birju Ruchir Desai (Querist)
Follow

22 July 2011 IF an assessee has Gross Total income of280000 and Deduction under Chapter VIA of120000. Will he require to get the books of accounts audited? Is he required to declare 8% of Turnover as income U/s 44AD?

Secondly if an assessee has a loss from business? Is he require to declare 8% of Turnover as profit? Or is he required to get books of accounts audited incase if he files his return as loss return inorder to carry forward the loss?

CA Navin Jain

CA Navin Jain (Expert)
Follow

22 July 2011 1. he required to declare 8% of Turnover as income U/s 44AD otherwise get account audited under sec 44AB.

2.IF YOU WANTS TO SHOW THE LOSS IN THE BOOK THEN GET AUDIT TO ACCOUNTS.

CA Birju Ruchir Desai

CA Birju Ruchir Desai (Querist)
Follow

22 July 2011 Then Sir what is the importance of Provision of Section 44AD(5). Will u please guide me?
As in the first case his total income is below taxable limit and profit and gains from business is less than 8% of turnover.In this case both the condition of Sec 44AD(5) are satisfied.

Amol Gopal Kabra (CA,CS,DISA)

Amol Gopal Kabra (CA,CS,DISA) (Expert)
Follow

22 July 2011 Sec 44AD(5) says that in case the income is below basic exemption limit, then no need to get books of accounts audited. But the interpretation is that in case the presumptive income of 8% is also below taxable limit, then no need to get books of accounts audited. Say for example, the turnover is Rs. 19 lakhs, in this case, the presumptive income comes to Rs. 152000, which is below taxable limit. Here, even if the assessee shows the income as Rs. 140000, it wont matter as the presumptive income itself is below taxable limit.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now