Sec 44ada it filer books of accounts exempt or mandatory

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This query is : Resolved

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For individuals filing under Section 44ADA, maintaining detailed books of accounts is generally not mandatory. However, you are required to keep records of amounts received via cash and bank, along with any outstanding receivables. While not strictly for the Income Tax Return itself, these records are important for confirming cash receipts and can be useful during scrutiny assessments.

Kollipara Sundaraiah

Kollipara Sundaraiah (Querist)

04 May 2024 Sir,
Sec 44ada provision itr filed person books of accounts maintained mandatory or exempt.

Dhirajlal Rambhia

Dhirajlal Rambhia

(Expert)

04 May 2024 Not mandatory, but statement of amounts received by cash & bank are required to be maintained, along with receivables, if any.

Nikhil Kaushik

Nikhil Kaushik (Expert)

04 May 2024 is it relevant for 44ADA? separation of cash and bank?

Dhirajlal Rambhia

Dhirajlal Rambhia

(Expert)

04 May 2024 Naturally not for ITR, but for confirmation of cash receipts.

Nikhil Kaushik

Nikhil Kaushik (Expert)

06 May 2024 i think, if the intent is to report, then confirmation of cash receipt is not going to be something that I would record as a professional. If the intent is not to report, then anyway i am not recording. The whole point of 44ADA being not maintaining any records. maintaining cash records could and would only complicate other compliances.

Dhirajlal Rambhia

Dhirajlal Rambhia

(Expert)

06 May 2024 There is no specific rule how you maintain the records of the receipts, which is the only compliance under sec. 44AD/44ADA. Even during query/scrutiny these record is verified. Practically, we have found it useful to record it in two different columns, which saves time in future, in case it is needed.

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