Sayyed mohammed Shahid (CA - Article) 11 July 2019
I just want your Views on section 44AD of the income tax Act 1961.
One of our colleague said that If An Assessee has income more than 8% of gross turnover and he/ she file return under section 44AD then he/she liable to disclosed actual income earned by him/her. Means assess disclosed income at 8% on gross receipts but they incurred only 50% expenses on gross receipts, so according to my colleague Assessee will be liable to pay tax on 50% not 8% on gross receipts. Is he right?
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Mujeeb rahuman (Audit assistant) 12 July 2019
net presumptive income u/s. 44AD means
actual higher income declared
if net income is higher than 8 % , we should declare net income as presumptive income after addition inadmissible expenses and 20% or 25% of personal uses