FAQs on Tax on Presumptive Taxation Scheme

Chapters / List

1. What is the meaning of presumptive taxation scheme?

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2. Who is eligible to take advantage of the presumptive taxation scheme of section 44AD?

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3. Which businesses are not eligible for presumptive taxation scheme of section 44AD?

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4. Can an insurance agent adopt the presumptive taxation scheme of section 44AD?

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5. Can a person engaged in a profession as prescribed under section 44AA(1) adopt the presumptive taxation scheme of section 44AD?

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6. Can a person whose total turnover or gross receipts for the year exceed threshold limit adopt the presumptive taxation scheme of section 44AD?

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7. What is the manner of computation of taxable business income under the normal provisions of the Income-tax Law, i.e., in case of a person not adopting the presumptive taxation scheme of section 44AD?

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8. What is the manner of computation of taxable business income in case of a person adopting the presumptive taxation scheme of section 44AD?

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9. As per the presumptive taxation scheme of section 44AD, income of a taxpayer will be computed @ 8%/6% of the turnover or gross receipt and from such income can the taxpayer claim any further deductions?

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10. If a person adopts the presumptive taxation scheme of section 44AD, then is he required to maintain books of account as per section 44AA?

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11. If a person adopts the presumptive taxation scheme of section 44AD, then is he liable to pay advance tax in respect of income from business covered under section 44AD?

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12. If a person adopts the presumptive taxation scheme but he opts out from the scheme in any of the subsequent five years, then what are the consequences?

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13. Who is eligible to take advantage of the presumptive taxation scheme of section 44ADA?

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14. What is the manner of computation of taxable income in case of a person adopting the presumptive taxation scheme of section 44ADA?

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15. Can a person who adopts the presumptive taxation scheme of section 44ADA claim any further deduction of expenses after declaring profit @ 50% of gross receipts?

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16. If a person adopts the presumptive taxation scheme of section 44ADA, then is he liable to pay advance tax in respect of income from profession covered under section 44ADA?

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17. If a person adopts the presumptive taxation scheme of section 44ADA, then he is required to maintain books of account as per section 44AA?

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18. What provision will apply if a person opt for the presumptive taxation scheme of section 44ADA and declares his income from profession at lower rate (i.e. less than 50%)?

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19. For whom the presumptive taxation scheme of section 44AE is designed?

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20. Who is eligible to take advantage of the presumptive taxation scheme of section 44AE and which business is eligible for the presumptive taxation scheme of section 44AE?

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21. Can a person who owns more than 10 goods vehicles adopt the presumptive taxation scheme of section 44AE?

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22. As per the presumptive taxation scheme of section 44AE, income of a taxpayer will be computed at the rate of Rs. 7,500 per goods vehicle per month or Rs. 1000 per ton of gross vehicle weight per month and in such a case can the taxpayer claim any further deduction income.

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23. If a person adopts the presumptive taxation scheme of section 44AE, then is he required to maintain books of account as per section 44AA?

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24. If a person adopts the presumptive taxation scheme of section 44AE, then is he liable to pay advance tax in respect of income from business covered under section 44AE?

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