Section 44 AD [Confused]

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This discussion addresses concerns about Section 44AD and GST registration for an unregistered entertainment website earning revenue from US display ads. The user seeks clarification on filing under 44AD using a personal PAN, the necessity of GST registration for income exceeding ₹20 lakh, and whether declaring a minimum profit of 6% is permissible even with higher actual profits. The responses suggest that GST registration is required, but no other registration is needed unless employing over 10 people. Employee TDS must be deducted, and splitting income between partners is a consideration for individual tax filings.

Gaurav

Gaurav (Querist)

27 February 2023 I have an entertainment website that generates revenue from display ads.

Few points:
1. The business is not registered yet.
2. Income comes in dollars from a US-based company.
3. Revenue is less than 1 crore.
4. Need help regarding 44 AD and If GST registration is needed.

My doubt:

1. Can I file 44AD without registering the business which means directly from the PAN account where income gets deposited?

2. If GST registration required?

3. Some CAs are arguing that if your profit is more than 6% then you have to show the actual profit. My profit is more than 60% but I want to show the 6% only. Is that ok?

Here I have found a case where the assessee challenged the AO officer and won the case just showing minimum profit even though the profit was much higher.
https://indiankanoon.org/doc/151903937/
https://www.caclubindia.com/forum/profit-under-section-44ad-ada-473205.asp

Here tax2win CEO says that only a minimum of 6% is required even if profit is higher.
https://tax2win.in/guide/section-44ad-44ada-44ae

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

27 February 2023 1 and 2 GST registration required as you provide service in excess of 20 lacs . File LUT no GST payable. You can opt for 44AD.
3 yes it's ok.

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Gaurav

Gaurav (Querist)

27 February 2023 Hi Sir,
Thanks for your response. Just GST registration is needed,right?No other registration required?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

27 February 2023 Yes, GST registration required.
No other registration required if you don't employ more than 10 persons.

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Gaurav

Gaurav (Querist)

01 March 2023 Hi Sir,
Do I need to deduct TDS of employees in the 44AD case?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

01 March 2023 Yes, employees TDS required in 44AD case.

Message likes : 1 times

Gaurav

Gaurav (Querist)

02 March 2023 Hi Sir,
Thanks for your response.
If there are 2 partners in this case and revenue came into only one partner's PAN account then splitting income between partners will not be an issue from another person's income tax point of view? Should He file ITR or not ?

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