44ad teaching profession

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Kiran (Querist)
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22 December 2016 hi. i am running teaching institute. i have proprietary firm registered. i file return every year. now i learnt about this new act 44ad. will i am eligible for this. i take all online payments in my saving account. i also have current account but i have pos machine which settle in saving account.will my income considered as 8 percent of total whatever i earn. do i need to maintain all receipt of students fees and all expences. do i need service tax registration as i have more income that limit of service tax.
please help. thanks.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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23 December 2016 If you are hiring teachers and running the institute as business you are eligible for section 44AD. You need to maintain all receipts of students. No need to maintain expenses ac. Service tax registration required when your total receipts for a year exceeds 9 lacs.

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Kiran

Kiran (Querist)
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25 December 2016 thanks. sir. i will need to register for service tax. then i need to pay service tax seperately and income tax seperately. so 2 taxes will be there. am i correct?
if one student pays 10k then service tax of approx 1460 goes to govt. and my income tax as well. is it correct?
pls helpme.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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25 December 2016 Yes, you have to pay 2 taxes, but the service tax you can collect it from the student. In case of 10000 fess collect 15% service tax at 1500 and pay it to govt. Total bill will be 11500.
Income tax you pay it from the profit you earn from the 10000 fees, after meeting all expenses.

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