DR SUNDEEP NIGAM (DOCTOR) (74 Points)
16 March 2025I am a government doctor. I get regular salary on which TDS is deducted u/s 192 and also receive proff fee around rs 3 lakh per annum on which TDS deducted @ 10% and TDS deducted u/s 194JB. As I am a government employee I don't keep any record on my expenditure.
My query is can I claim income tax benefit under 44ADA on the proff fee amount of rs 3 lakh?
MPR Sanjay Kumar
(3131 Points)
Replied 16 March 2025
Yes, as a government doctor receiving professional fees of ₹3 lakh per annum (with TDS deducted under Section 194J), you can claim the income tax benefit under Section 44ADA for this professional income, provided you meet the eligibility criteria. Here’s how it works:
Eligibility for Section 44ADA
Profession Type: Section 44ADA applies to professionals engaged in specified fields such as medical, legal, engineering, architecture, accounting, and other similar professions. As a doctor, your profession qualifies under this section.
Gross Receipts Limit: The gross receipts from the profession must not exceed ₹75 lakh in a financial year (effective from April 1, 2024; earlier limit was ₹50 lakh). Since your professional fees are ₹3 lakh annually, you are well within this limit.
Nature of Income: Section 44ADA is applicable to income earned from professional services. Since your professional fees are categorized as such and TDS is deducted under Section 194J, this income qualifies for presumptive taxation.
Benefits of Opting for Section 44ADA
Under Section 44ADA, you can declare 50% of your gross receipts as taxable income, assuming the remaining 50% accounts for expenses. This simplifies tax compliance as you are not required to maintain detailed records of actual expenses.
For your professional fees of ₹3 lakh, only ₹1.5 lakh (50%) will be considered taxable income under this scheme.
Key Considerations
If you opt for Section 44ADA, you cannot claim additional deductions for actual expenses incurred related to this income.
Your salary income (on which TDS is deducted under Section 192) will be taxed separately as per the regular slab rates applicable to salaried individuals.
By opting for Section 44ADA for your professional fees, you can simplify tax compliance and potentially reduce your tax liability.
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