Pls solve : does turnover include incentive recd. from co?

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

20 September 2011 Dear Experts

"Does Turnover include the INCENTIVE/ UPFRONT SCHEME GOODS?????

Please reply with reference to Sec. 44AD (Presumptive Taxation).

Please calculate the Tax liability w.r.t given below example presuming assessee wish to opt Sec. 44AD

1. Sales Rs 15.10 Lacs
2. Incentives & upfront Goods recd. Rs
1.40 Lacs (Not included in above Sales)

So basically the question is "whether 8% will be calculate on Rs 15.10 Lacs or on Rs 16.50 Lacs i.e 15.10 + 1.40 Lacs"???

If it is to be calculate only on Rs 15.10 Lacs, then what will be the treatment of Rs 1.40 Lacs????? Can we claim expenditure from that Income????

Pls reply soon

Thanking you

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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23 September 2011 The incentive is out of your business income. Since your total turnover does not exceed 60L you have to show 8% as net profit and no expenses can be claimed.