my client is filing returns since 17-18 ay under sec 44ad.
in 19-20 ay his turnover exceeds 1 crote and done tax audit filed the return.
in 20-21ay his turnover is 48 lakhs. he filed return under section 44 ad. showing profit @ 13%.
is it right
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Sec 44 AD of it act
Replies (5)
Quick Summary
Ok there is no problem, turnover is less than 2 crores rupees
It is valid but you have to opt for presumptive taxation u/s 44AD for consecutive 5 years until and unless your turnover exceeds threshold limit of 2 crore.
He cannot opt for 44AD now. Pl see second proviso to section 44AB and Section 44AD(4).
Yes, Yes he is not eligible for 44AD as audit has been done
If you are opting for the presumptive scheme, you must-
a. File presumptive scheme for at least 5 years in continuation.
b. If you decide to show and file profits as per regular business before the end of these 5 years, you will lose presumptive benefits and disallowed from presumptive taxation for the subsequent 5 years.
Please note that 5 years shall be counted starting the year in which you first file usual taxes for such business. The government is discouraging taxpayers from misusing the scheme and constantly changing their option often. So if you opt for presumptive continue for 5 years and if you want to opt out, you’ll be barred from resuming presumptive for a period of 5 years.
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