Taxability of LIC Commission

44AD is not a relief to tax payer but an norm to check whether the assesee has declared net taxable profit @ 8% of total turnover or not, if not then they are bound to get their accounts audited even below the audit limit 

you have to declare your normal profit as per business norms, in case it goes below 8%, then u have to get your accounts audited

thats the main factor of 44AD

nice explanation by U S SHARMA

Thank you for ur prompt reply Mr. Sharma. My question was misunderstood. I understand the provisions of 44AD. Also that it deals with any type of business and LIC comm. is also a business income.

Going by ur answer, can we assume the LIC commission to be turnover for the purpose of 44AD since it is a business OR does the LIC Commission get taxed as per the 2nd method ie. ad-hoc deduction u/s 57.

LIC commission earned is a business turnover, 

what is this 60000 u mentioned in your query, line is posted below again............

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2. Does it still qualify for Ad-hoc deduction u/s 57 (If less than 60000) and normal tax provisions for more than 60000

Well that was regarding the provision u/s 57.. where ad-hoc deduction is available where lic commission is less than 60000.. ie. deduction 50% for 1st year and 15% for renewal commission...

so i was confused between this provision and new 44AD ?

when the total limit of sec 57 is limited to 60000 which is much lower than threshold exemption limit of individual, whats utility of this? 

this may be useful for any person who has insurance commission as his side business / part time, alongiwth his other main taxable business/ employment. 

Section 44AD clause 6, specifies that it is not applicable to income by way of commission / brokerage.

(6) The provisions of this section, notwithstanding anything contained in the foregoing provisions, shall not apply to—

  (i)  a person carrying on profession as referred to in sub-section (1) of section 44AA;

 (ii)  a person earning income in the nature of commission or brokerage; or

(iii)  a person carrying on any agency business.]

The working of Section 44AD is gross turnover @ 8% will be income under head business if turnover is less than 60 Lacs