Applicability of section 44ad

In a case where profit exeeds 8% of sales, are the benefits of 44AD available if the profit is declared as exceeding 8%?

That is, is it necessary to maintain books of accounts and prepare Balance Sheet and Profit and Loss Account showing how the profit was arrived at ? Can ITR 4S be used if profit is in excess of 8% ?

I just want to be clear whether the benefits of 44AD are available only when the profit is declared as 8% or whether it is available even when you declare a higher profit like say, 9.5 %.

 

Replies (6)

benefit is  available even when you declare a higher profit like say, 9.5 %.Bz 44ad says that taxpayer can voluntarily declare a higher income in his return and books are not required to maitain.only amt of debtors,cash,stock is required in 4s

Yes nitika is right. you can declare higher profits and still section 44 AD will be applicable

the maim thing is if you want to declear < 8% then the sec  comes to play, your book should get audited , to do so .

 

ITR-4S can be used but still you will have to maintain books of accounts as per Section 44AA(2)(i)/(ii)

Thank you for the replies.

Vishal, that is what I wanted clarity on. I had this misconception that books need not be maintained if the profits are higher than 8 %.

benefit is  available even when you declare a higher profit like say, 9.5 %.Bz 44ad says that taxpayer can voluntarily declare

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
20 September 2026
Semi Qualified CA

Navin & Associates

Mumbai

CA Inter

View Details
Company
14 October 2026
Accountant

Rize.farm

Bengaluru

B.Com

View Details
Company
ARTICLESHIP 07 October 2026
Article assistant

S.K.Bajpai & Co.

Noida

B.Com

View Details
Company
07 October 2026
Senior Account Manager

Amplio Invest

Mumbai

M.Com

View Details
Company
10 October 2026
Accounts Associate Level 1

Abic and Mani Chartered Accountants

Kottayam

B.Com

View Details
Company
22 September 2026
Account Assistant

Chirag P Shah & Co. Chartered Accountant

Pune

B.Com

View Details
Company
ARTICLESHIP 07 October 2026
Article Trainee/ CMA Trainee

RMA And Associates LLP

New Delhi

CA Inter

View Details
Company
15 October 2026
Senior Accountant

Continental Belting Pvt Ltd

Mumbai

B.Com

View Details