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44AD with commission income

18 October 2020

from past 2 years i filled my IT return u/s 44AD and in current year i earned commission income from which tds deducted so can i show this commission income and file my IT return u/s 44AD ?
thanks in advance

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9 Replies

ayusmita (Tax consultant) (5885 Points)
Replied 18 October 2020

File itr 3 shows all the income from your business n your commission too

1 Like

yugal jain (197 Points)
Replied 18 October 2020

Yes you can show commission income as income from business and if total receipts are less then 2cr then you can file itr 4 and show income under u/s 44AD

ayusmita (Tax consultant) (5885 Points)
Replied 18 October 2020

Commission income cannot be shown in itr4

2 Like

Arif Ali (Apt Co Advisory) (1230 Points)
Replied 18 October 2020

Commission Income may not be shown under section 44AD.

Vizttax Services Pvt Ltd
8506916831

1 Like

yugal jain (197 Points)
Replied 18 October 2020

If commission I come is not more and possible to show as income from other sources..it is advisable to show rest of the business income under section 44AD and commission income as income from other sources...because if you opt out you cannot claim be edit for 5 subsequent Assessment years and also there will be requirement to get books audited for subsequent assessment years

1 Like

ayusmita (Tax consultant) (5885 Points)
Replied 18 October 2020

If a person is earning commission income which is incidental in nature and shall not engaged in the commission agency business then such commission comes under other source of income not all commission or as per small or big amount

1 Like

zishan mandli (203 Points)
Replied 19 October 2020

Thanks a lot to both of you @ ayusmita and @ yugal jain

CS KARKERA AND ASSOCIATES (Chartered Accountants) (2 Points)
Replied 08 January 2021

A person who is earning income in the nature of commission or brokerage cannot adopt the presumptive taxation scheme of section 44AD.

Such Person Only file ITR - 3

Apurba Pandit (Owner) (0 Points)
Replied 24 July 2023

IT return u/s 44AD refers to the Income Tax Return filed by businesses opting for presumptive taxation under Section 44AD of the Income Tax Act. Businesses with a turnover of less than Rs 2 crore can choose to be taxed presumptively at a fixed percentage of their turnover (8% for non-digital and 6% for digital transactions).

Businesses excluded from presumptive taxation (Section 44AD) are:

Life insurance agents cannot avail of the presumptive taxation scheme.
Businesses earning income through commission are not eligible for presumptive taxation.
Businesses engaged in the transportation of goods through plying, hiring, or leasing goods carriages are not covered under presumptive taxation.