I own 5 Lorry. My gross receipt is Rs.15,25,000 from freight/delivery charges. Which section i can choose 44AE or 44AD. Because both section has 11008 'transport by road'. Can i choose 44AD 8%.? pl help
29 May 2020
Section 44AE The scheme u/s 44AE is designed to give relief to every person who is engaged in the business of plying, hiring or leasing of goods carriages and who does not own more than 10 goods carriage vehicles at any time during the relevant year.
One major difference as compared to Section 44AD is that “person” in this section includes every person i.e. an individual, HUF, firm, company, etc. In case, you are adopting the provisions of section 44AE, your income will be computed @Rs. 7,500 per vehicle per month during which the vehicle is owned by you and where the part of the month would be considered as a full month. And if the actual income is higher than the presumptive rate, i.e., higher than Rs. 7,500, then such higher income can also be declared as per the wish of the taxpayer. Further, you can declare income at a lower rate (i.e., at less than Rs. 7,500 per goods vehicle per month) but if you do so, and your income exceeds the basic exemption limit, then you will be required to maintain the books of accounts u/s 44AA and to get your accounts audited u/s 44AB. The provisions relating to the admissibility of deductions, depreciation, written down value of the asset, advance tax, maintenance of books of account and audit of accounts are same as discussed above. Only a partnership firm can claim the further deduction on account of remuneration and interest paid to partners. For example, if you are engaged in the business of plying, hiring or leasing of goods carriage and you own 7 vehicles throughout the year, then your income u/s 44AE shall amount to Rs. 6,30,000/- (i.e. Rs. 7500 x 7 vehicles x 12 months).
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