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Applicability of 44ADA if profit is 80 % of income

the_spiderman (Taxpayer) (30 Points)

02 August 2022

I'm a independent professional and my income is less than 50 lakhs. I'm eligible for 44ADA but I have one query, If my expense is about 20% and my profit is about 80%, am I still eligible for 44ADA and can claim 50% profit?

Is there such rules like I must have at least 40% expense to avail 44ADA benefit or anyone regardless of their expense (even if it's 5%) can can claim 50% profit under 44ADA?

Thanks!

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5 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (171414 Points)
Replied 02 August 2022

There is no cap on expenditure. The act says, minimum profit margin should be 50%, it can be higher as declared by assessee.

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the_spiderman (Taxpayer) (30 Points)
Replied 02 August 2022

Originally posted by : Dhirajlal Rambhia

There is no cap on expenditure. The act says, minimum profit margin should be 50%, it can be higher as declared by assessee.

Thanks for your reply sir. To clarify, If I have 80% profit of my income, I need to declare 80% profit under 44ADA or I need to declare flat 50% profit regardless of my profit margin?