As per Setion 44AD  small proprietorship and partnership business having turnover upto 2 crore
    need to maintain books of accounts and get accounts audited by CA
   They can straight away show 8%,6% of turnover as Profit and pay Income tax on it

 

  • Section 44AD Scheme
  • For FY 2016-17 (AY 2017-18) onward
  • If Turnover of Business upto 2 Crore,then
  • 8 % of Turnover is Profit for Cash Transactions
  • 6% of Turnover is Profit for Other Transactions
  • No need to make books of accounts
  • No need to do Audit

What if assesse show less than 8%,6% profit or loss?
It is not allowed as per Section 44AD
He has to compulsorily gets accounts audited and pay tax on it.

This scheme only for Proprietorship and Partnership who are Resident

Q1  
Suppose a Partnership firm has turnover of 80 lacs ( 20 lacs cash rest in bank)
What is its business Income
How much Income tax he is payable by it?

View Answer

 

Q2

Can it pay Interest and Salary to Partners to reduce its tax liability?

View Answer

 

  1. Income Tax
  2. PGBP Income
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CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 8 years. He provides GST Training in Delhi. Register now.