Run proprietorship and OPC together

Tax planning 225 views 2 replies

Hello

I currently run a proprietorship software development business and also run a one person company doing data analytics and software development.

I have only two clients right now and one of them I raise invoices from both depending on nature of work. This year my total (from both the firms) reciept of invoices will cross 55L in revenue. Until now I have been showing my proprietorship income under 44ADA and withdraw some salary from OPC.

Now, I have consulted two CAs and they have given conflicting answers to the questions:

1. Can I continue to use 44ADA for my professional income as long as it under 50L individually?

2. Can I bill the same client from both the firms depending on nature of work?

3. Can this setup cause issues down the road?

Further to clarify, I employ part time contractors for work done in the OPC whereas proprietorship work is all taken care by me only.

Any responses are really appreciated! Thanks!

Replies (2)
1. 44ADA is not applicable to companies. In your individual return, till the time your professional income from software development is upto 50L, you can cover yourself under 44ADA
2. Yes you can
3. No issue in this setup.

Thanks Mr Doshi!
Anyone has a different viewpoint or all agree?


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