section 44 AD

rahul (a) (1620 Points)
Replied 20 October 2018

not covers losses

8% profit req. and 6% when digital receipt..

CA Rakesh Joshi (Chartered Accountant ) (1272 Points)
Replied 20 October 2018

Yes. Loss is below 6% only right?

CA Rakesh Joshi (Chartered Accountant ) (1272 Points)
Replied 20 October 2018

If you show loss under presumptive taxation then ypou nee to maintain books of accounts u/s 44AA and go for tax audit u/s 44AB as per the provision of Sec 44AD(5).

Anonymous (Business) (240 Points)
Replied 20 October 2018

@ rahul

is this because loss have inter head adjustment (except salary ) ?

aradhana upadhyay (151 Points)
Replied 20 October 2018

Yes. Profit less than 6% includes loss

1 Like

Anonymous (Business) (240 Points)
Replied 20 October 2018

@ rakesh

is tax audit applicable for those only who offer 6 % earlier but opt out during the next 5 yrs

or it is for everyone ?

rahul (a) (1620 Points)
Replied 20 October 2018

anonymous

i think compulsory to complete 5 year under 44AD

1 Like

CA Rakesh Joshi (Chartered Accountant ) (1272 Points)
Replied 20 October 2018

Once the presumptive taxation is opted then you need to continue to opt under this for 5 consecutive AY's.

In case you wants to show profit below 6% or 8% as the case may be, in any of that 5 AY's, then need to maintain books and go under tax audit.

1 Like

Anonymous (Business) (240 Points)
Replied 20 October 2018

new sub section ( 5) also says about the requirement of books and audit from AY 2017-18
Accordingly books and audit require only when
(a) the provisions of sub section (4) are applicable to the assesee ; and
(b) the total income of the asessee is more than the basic exemption limit.

sub section (4) of section 44 AD applies when assesee declare profit under this section in previous year but declare less than presumptive profit (6/8 % )during next 5 years

Dear experts

should I conclude that if turnover is below 1 cr and I have not opted sec 44 AD earlier I can file loss ITR without tax audit.
There is no need to check whether income from other heads exceeds basic exemption limit or not because I have not declare 6 % earlier and there no question of breaking condition of 5 yrs arises.
In such case the due date to file ITR will be 31st july
Am I correct ?

Thx

Anonymous (Business) (240 Points)
Replied 20 October 2018

new sub section ( 5) also says about the requirement of books and audit from AY 2017-18
Accordingly books and audit require only when
(a) the provisions of sub section (4) are applicable to the assesee ; and
(b) the total income of the asessee is more than the basic exemption limit.

sub section (4) of section 44 AD applies when assesee declare profit under this section in previous year but declare less than presumptive profit (6/8 % )during next 5 years

Dear experts

should I conclude that if turnover is below 1 cr and I have not opted sec 44 AD earlier I can file loss ITR without tax audit.
There is no need to check whether income from other heads exceeds basic exemption limit or not because I have not declare 6 % earlier and there no question of breaking condition of 5 yrs arises.
In such case the due date to file ITR will be 31st july
Am I correct ?

Thx

CA Rakesh Joshi (Chartered Accountant ) (1272 Points)
Replied 20 October 2018

Please understand you can opt of 44AD only when your turnover is less than 1 Cr otherwise straight away tax audit under 44AB. Hence, when tax audit applicable then any way you have to maintain books and can declare loss. No issue here.

If your declaring income u/s 44AD then you should declare your income atleast 6 % or 8% as the case may be. If you dont do that and declare loss then maintain books and get your books of accounts audited.

I think you got the answer.

M Aiyyar (learner) (280 Points)
Replied 20 October 2018

Originally posted by : Rakesh Joshi

Please understand you can opt of 44AD only when your turnover is less than 1 Cr otherwise straight away tax audit under 44AB. Hence, when tax audit applicable then any way you have to maintain books and can declare loss. No issue here.If your declaring income u/s 44AD then you should declare your income atleast 6 % or 8% as the case may be. If you dont do that and declare loss then maintain books and get your books of accounts audited.I think you got the answer.