Section 44 AD Detailed

HI

1st of all sec 44 AD is a special provisio for Civil Construction Business.

MR. GANESH SEC 44AD HAS BEEN CHANGE A.Y. 2011-12 , SEC 44AF AND AD IS CANCELLED AND NEW SECTION 44AD BOTH,PLS READ AMMENDMENT 2011

non maintance of books accepted upto 60 lakhs only

You can show profit more than 8%.

This section is applicable only for Income from business. Income from profession is not covered by this section.

you can show profit as per 8% of gross recipt bt it is only applicable for retail business....

Hi to all

I also have query regarding 44AD i.e following

1) If speculation profit or FNO Profit than how will be calculate 8% of the gross recipt ?

2) If FNO loss or Speculation Loss than u/s 44AD audit is compalsory ?

Plz ans. my question if any budy have

Thanking You

44AD us a criteria of asseee where its defined that who is liable for compulsary audit and who is not, it does not mark any body to declare or not declare profit percentage. it species that if assesee does declare profit more than 8% of his gross business receipts then he is liable to compulsary audit, 

it does not exempt any assesee to maintain books of records, where the income is above 1.2L books and records maintained under any business where audit is not comulsary depends on the complexity of business, however prescrbed books and records is mandatory when audit gets compulsary. 

its getting misunderstood that 44AD exempt the assesee to maintain the books and records, or they can show their profit which is more then 8% to 8% only without records, which is wrong, its just a norms declared where the assesee face dificulty to ascertain profit for the year( due to long term projects where payment is received on presumption basis and cost would be finalized on project finalization only) due to complexity of business, but it does not mean that department is asking them to declare profit lower than their business profit.

My Dear member,

As per section 44AD,an eligible assessee [indivdual,HUF, Partnership firm,] is engaged in an eligible business[ any business except plying,hiring,or leasing goods] in the previous year[2010-11] has to show at least 8% profit of the total turnover or gross receipt , if the same is up to 60 lakhs. If the assessee does not show the at least 8% net profit, he has to get the audit under sction 44AB. It is very clear that there is no question of rtail or wholesale trader. Moreover gross recepit means if the assessee earns interest, discount, commission etc, it shall be also included alogwith the sales. therefore all sales and whatever credit are shown in the credit side of the profit and loss account, that shall be also considered for the caculation of 8 %

                                                                                            C. A. K.C.AGARWAL,    ALLAHABAD 

SECTION 44AD talks about business income only and not interest, commission etc which are taxed under income from other sources. Gross receipts or turnover means for service and other businesses.

MY DEAR C A SUDARSHAN

 commission, discount , interest related to business activity shall be considered. For example- interest realied for over due payment, commission, discount received on account of incentive to meet out the target , has to be considered

   CA KC AGARWAL, ALLAHABAD

MY DEAR C A SUDARSHAN

 commission, discount , interest related to business activity shall be considered. For example- interest realied for over due payment, commission, discount received on account of incentive to meet out the target , has to be considered

   CA KC AGARWAL, ALLAHABAD

Dear Members,

Section 44AD says 8% of gross receipts to be considered as income. In that case if Gross Receipt is Rs.10 Lacs then income will be Rs.80K.

Now tax will be calculated on Rs.80K and considering the Tax slab of Individual. Correct me If I am wrong.

For example: -An Individual has receipts of Rs.10 Lacs from Rent and Other Income Say Salary Rs.5Lacs and Interets Say Rs.10K

Now Income u/s 44AD will be Rs.80K+5L Salary + 10K = Total Income Should be Rs.5.9 Lacs

Now the Income tax slab will be applicable or not. As far As I think Same will be applied.

Need your clarificatiion

Thanking you

The speculation Profit is treated as business income and same is the case with specualtion loss as business loss. Whether in case of specualtion loss whether the assessee has to get his acounts audited  because it is business loss and 8% income of turnover criteria can not be applied because of loss.

whether Insurance commission is included in Section 44 AD or not

Can a LIC agent can show his income 8% of his commission.