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New Presumptive taxation u/s 44AD from AY 2011-12

Page no : 2

Samir (ACA) (113 Points)
Replied 05 July 2011

If this Section is applicable to all business except Professions and that covered under section 44AE.

(1) Does it means that it is better that business such as Tuitions, Beauty Parlours, Hobby Classes, Retail Stores, Milk Centers, & other business which has turnover less than 60 lacs should take benefit of this section and declare 8% income of the turn over and remain free from maintaining a/c's books, etc.?

(2) What if an aassesse has any of the aforesaid business but his profit is more than 8% of his Turn over, still should he take advantage of this section? (can the AO take objection, that you have no expenses and your margin is more than 8% of the turnover )

Samir (ACA) (113 Points)
Replied 08 July 2011

If this Section is applicable to all business except Professions and that covered under section 44AE.

(1) Does it means that it is better that business such as Tuitions, Beauty Parlours, Hobby Classes, Retail Stores, Milk Centers, & other business which has turnover less than 60 lacs should take benefit of this section and declare 8% income of the turn over and remain free from maintaining a/c's books, etc.?

(2) What if an aassesse has any of the aforesaid business but his profit is more than 8% of his Turn over, still should he take advantage of this section? (can the AO take objection, that you have no expenses and your margin is more than 8% of the turnover )


Samir (ACA) (113 Points)
Replied 11 July 2011

Hello can anyone advise Please!


Rishab (A.C.A.) (155 Points)
Replied 15 July 2011

A person has Turnover of Rs. 50,00,000/- and Net Profit thereon of Rs. 7,50,000/-.

Now is it fair for him to take advantage of this Section and show NP @ 8% of the turnover i.e. Rs. 4,00,000/-. & accordingly pay tax on it or it would be appropriate to show the NP at actual Rs. 7,50,000/- ?

 

I understand that this provision has been made to dissuade assesses from declaring a profit of less than 8%. This amendment should have exempted even those tax payers from maintaining books of accounts who declares his Net Profit more than 8% of the Turnover, as he is behaving in a responsible manner and naturally helping the government and paying more tax.

 

But I think it is wrong to exempt persons from compulsory Audit who’s total Income does not exceeds the exemption limit.

This increases the complexity of the Income Tax Act and Why this amendment at stage when the Govt is in process to replace the entire Income Tax Act with Direct Tax Code.

1 Like

anil yadav (CA) (22 Points)
Replied 16 July 2011

as per definition of BUSINESS , the business includes professional.  so section 44AD covers professionals too.


anil yadav (CA) (22 Points)
Replied 16 July 2011

as per definition of BUSINESS , the business includes professional.  so section 44AD covers professionals too.


Sandeep Pandey (Manager) (24 Points)
Replied 26 July 2011

Business has been defined in section 2(13) and profession  has been defined in section 2 (36). Hence provisions for 44AD is not applicable for profits and gains from profession.


pawan swami (ADVOCATE) (46 Points)
Replied 27 July 2011

i have one Problem for Contractor Income of Rupees 2400000/- i have calucate Tax  # 8% Gross Reciept  2400000/- is that Wright Please Suggest me early as the possible  192000/-


YADAV SANTOSH (C.A FINAL, M.COM) (95 Points)
Replied 25 November 2011

Very Well Explained and Especially the Coverage is good!!

Chintan (Accounts and Finance Executive CS Executive Pursuing)   (98 Points)
Replied 25 November 2011

I Think, As per New Provision  , 44 AD Covers Income from Businees or Profession 


CA. Amit Singhvi (infrastructure real estate)   (38 Points)
Replied 09 December 2011

We are having jewellery business , maintaining BOA , This year due to rates of gold & silver on higher side our Profits are 15% of T/O. If we should go for 44AD this year declaring 8% profit of T/O. our T/O is less than 60 lacs.

 


Prashant R. Karia (CA AT FIRM) (82 Points)
Replied 30 March 2012

I have a doubt friends. As i read this section i come to know that person opting for 44AD is not required to pay ADVANCE TAX. So it does means that he will also save his interest u/s 234B and 234C.

viral bhagdev (student) (46 Points)
Replied 07 July 2012

This section has been inserted to replace existing section 44AD and 44AF and this new section will be applicable to any business (whether it is retail trade or civil construction or any other business) except the business of plying, hiring or leasing goods carriages referred u/s 44AE.

Hence the above section is not applicable to professionals.


Prasada rao.vankayala (commerce) (21 Points)
Replied 07 August 2012

sir one question about this presumtive business  8% tax rate applicable for this 12-13 financial year also continued or whether any change plz reply me 


Prasada rao.vankayala (commerce) (21 Points)
Replied 07 August 2012

sir one question about this presumtive business  8% tax rate applicable for this 12-13 financial year also continued or whether any change plz reply me 



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