Applicability of 44AD

Applicability

The scheme of Presumptive Taxation under Section 44AD is designed to give relief to small taxpayers engaged in any business whose Sales Value is less than Rs. 2 Crores per annum ,It is pertinent to note here that Section 44AD is only applicable for.1. Individuals i.e. Proprietor/ Proprietorship Firm,2. Hindu Undivided Family (HUF),3. Partnership Firm,The benefit of this scheme is only applicable for Resident Indians and not for Non-Resident Indians (NRI’s). Moreover, it is also not applicable for any form of entity like Company, LLP etc other than those listed above.

Non-Applicability - Section 44AD is not applicable for - 1. Transporters i.e. business of plying, hiring or leasing of Goods. Scheme of Presumptive Taxation under Section 44AE is applicable in this case.2. Professionals – Scheme of Presumptive Taxation under Section 44ADA is applicable in this case.3. Any person who is carrying on Agency Business.4. Any person who is earning Income in the nature of Commission or Brokerage

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