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Section 44AD restriction

palika rastogi (palika) (195 Points)

08 August 2018

Please explain the restriction of Section 44AD for 5 years.

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3 Replies

prasad Nilugal (3924 Points)
Replied 08 August 2018

One's you opt out of 44 Ad scheme ,you can't avail for next. 5 years .

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RAJA P M ("Do the Right Thing...!!!") (128101 Points)
Replied 08 August 2018

https://cleartax.in/s/itr4

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CA Neelima Kotha (Consultant) (606 Points)
Replied 08 August 2018

In case you opt for presumptive taxation under section 44AD in a year, then you must opt the presumptive scheme for at least 5 years in continuation. If you opt out of the scheme, then you will not be allowed to file under presumptive scheme for the subsequent 5 years.

For example, you opted for 44AD for FY 2017-18, then you need to continue the scheme upto FY 2022-23. Suppose, you opt out of the scheme in FY 2020-21, then you cannot file under presumptive scheme upto FY 2025-26.

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