section 44AD and ITR

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prahlad tanwani (Querist)
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15 June 2011 if my commission income is only Rs. 10,000 and TDS Rs. 1,000 has been deducted by company.now for refund purpose i have to file my return of income.what ITR form should i file whether regular ITR4 or ITR4s.in this scenario what figure will be considerd as my turnover.if my turnover is considered Rs. 10,000 then can i show all this amount (100% instead of 8% as described in 44AD) as my total income while i have no any expenses to be deducted from this gross profit/receipts,and there is no any other income at all.

CA KRISHNA KUMAR DARUKA

CA KRISHNA KUMAR DARUKA (Expert)
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15 June 2011 You may show this income as Income from other source and file ITR2.

prahlad tanwani

prahlad tanwani (Querist)
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15 June 2011 my nature of business/profession falls in code 0301 as a general commission agent.i receive commission and not interest.then how can i go for ITR2.i declare my presumptive income Rs 10,000 on the basis of my annual gross receipt of Rs 10,000. then why souldn't i file ITR4s?---pl sir, make it clear. pl ref https://www.caclubindia.com/experts/for-commission-income-which-form-i-use-itr-4-or-sugam-itr4s--672200.asp

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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23 July 2025 This is an important distinction — let’s address your situation clearly:

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### 🔍 **Your Case Summary**

* You are a **general commission agent**
* You earned **₹10,000 as commission income**
* Company **deducted ₹1,000 as TDS (u/s 194H most likely)**
* You want to **file return to claim refund**
* You are asking:

1. Which **ITR form** to use — ITR-4S (now called ITR-4) or regular ITR-4?
2. Whether **Sec 44AD** applies to you?
3. Can you **show 100% of ₹10,000** as income and avoid expenses?

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## ✅ Answers

### 1. ❌ **Section 44AD does *not* apply to commission agents**

> As per the **Explanation to Section 44AD(6)**, the presumptive scheme **does not apply** to:
>
> > “a person carrying on agency business or earning income in the nature of commission or brokerage.”

✅ Since your entire income is **commission**, **Section 44AD is not applicable** to you.

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### 2. 🧾 **Which ITR form should you use?**

* Since your income is **commission (business income)** and you are **not eligible for presumptive taxation**,
* You **must use ITR-3** (or ITR-4 in earlier years, if applicable) and **maintain books** unless you're under the exemption limits for books of accounts under Section 44AA.

⚠️ **ITR-4S (Sugam)** — which was meant for Section 44AD — is **not allowed** for commission agents.

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### 3. 💡 **Can you show full ₹10,000 as income (no expenses)?**

Yes, **you can declare ₹10,000 as income** if you genuinely had no expenses.
However, it must be shown as **business income**, not under presumptive basis.

So, in ITR-3:

* Under **"Business Income"**, you can show:

* **Gross receipts**: ₹10,000
* **Expenses**: ₹0
* **Net profit**: ₹10,000
* Show **TDS of ₹1,000** in Schedule TDS
* You'll be eligible for **₹1,000 refund** (assuming no tax payable)

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### 📝 Summary

| Aspect | Your Situation |
| --------------------- | ---------------------------------------- |
| Nature of income | Commission (agency income) |
| Eligible for Sec 44AD | ❌ No — Section 44AD does **not** apply |
| ITR Form | ✅ **ITR-3** (not ITR-4S/Sugam) |
| Income to show | ₹10,000 under Business Income |
| TDS claim | ₹1,000 — to be shown in TDS schedule |
| Expenses | Can show ₹0 if you truly had no expenses |

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Let me know if you'd like a step-by-step on filling ITR-3 in this case.

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