ITR UNDER SEC-44 AD

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This discussion explores whether a coaching centre offering IELTS, PTE, and visa services can file its Income Tax Return (ITR) using Form ITR-4 under Section 44AD, declaring an 8% profit. The advice suggests this is possible, provided there's no commission or brokerage income. It also clarifies the tax audit limits, which depend on whether the declared profit is below 8% or if cash transactions exceed 5% of gross receipts/payments, and the overall turnover.

satish kumar Chauhan

satish kumar Chauhan (Querist)
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22 March 2024 Dear Experts

I run a coaching center of ILETS, PTE and Visa services etc

can i file ITR-4 and show profit 8% or more under sec-44AD

if no, what is the Tax Audit Limit in that case

Thanks

Nikhil Kaushik

Nikhil Kaushik (Expert)
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22 March 2024 you should be able to. But ensure that there is no commission/brokerage income in it.

The tax audit limit is as under:

If you are covered under 44AD but the profit is below 8% and the total income is above exempted limit, then audit will apply.

For other cases, it will be as under:

If the cash receipts/expenses are below 5% of the gross receipts/payments, then audit will apply if the turnover is in excess of RS 10 cr. Otherwise, audit will apply for turnover > 1 cr.

satish kumar Chauhan

satish kumar Chauhan (Querist)
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23 March 2024 Sir I also receive the commission and aproximate total gross income will be below 50 lac and the net profit will be 10.0 lac in that case which itr form applicable and tax audit requirement.
thanks

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