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Filing ITR4 44ADA as Visiting Faculty and Freelance Writer

Ritu (Teacher) (25 Points)

27 July 2023

Hello,

I had a query about filing ITR 4 under 44ADA presumptive taxation scheme. My earnings are from teaching as a Visiting Faculty (teaching Literature) at a university and freelance writing. Against both, my TDS has been deducted against 194JB. Which business code would apply to me? I don't see anything education related under 'profession'. The closest I see is 'Literary Activities'.

Also, even if my gross income doesn’t exceed 50 lakhs and I don’t have to maintain audited accounts, I was advised to keep an internal balance sheet to calculate the percentage of profit I show on the ITR (in case it exceeds 50%). What all expenses count as valid here? Does rent count, if I have had to move cities to teach?

Thank you,

Ritu

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5 Replies

CA. ANKIT PANDYA (CA) (682 Points)
Replied 27 July 2023

Section 44ADA applies only on profession specified under section 44AA(1) of the IT Act. Teacher is not a profession specified under section 44AA of the Act. So, Section 44ADA will not apply here.

if profession carried on is one that is not covered by section 44AA(1) of the Act (e.g. teaching, authorship), the person carrying on the same can avail the presumptive income scheme under section 44AD in respect of that profession and also in respect of any other eligible business.

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Ritu (Teacher) (25 Points)
Replied 27 July 2023

This is helpful, thank you. But, just to clarify further: won't it matter that teaching doesn't exactly fall under 'business' and this is a profession for which I have specialised qualifications, like others who fall under ADA?

CA. ANKIT PANDYA (CA) (682 Points)
Replied 28 July 2023

1. Section 44AD is general provision while Section 44 ADA is specified.

2. Section 44ADA covers only legal, medical, engineering or architectural profession or the profession of accountancy or technical consultancy or interior decoration or any other profession as is notified by the Board.

3. Section 44AD covers within its ambit Turnover as well as Gross Receipt. Gross Receipt is normally associated with service or professional activities.

4. You may be earning tuition fees and may disclose income higher than 8% or 6% as the case may be as per your records.

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Dhara (Professional) (23 Points)
Replied 20 July 2024

Hi Ritu,

Were you able to claim 50% under 44ADA for the income as a visiting faculty? Have a similar situation this year so confirming what did you finally go ahead with?