Presumptive Tax

Hi,

- Presumptive income should not be less than actual profit. Benefit of scheme is generally for those persons who re having losses and margin less tha 8% becaue in that scenario you have to go for Tax Audit. Presumotive means minimum income.

You can call to discuss further.

Thanks

I wouldn't recommend the same. 

It's a general misunderstanding about 44AD. On a careful reading, it gives below meaning-

1. 8% is not the maximum profit, it's rather the lowest one can declare. So if you earn more than 8% , than that portion has to be declared.
2. If profit is shown below 8% than, compulsorily audit needs to be done, whether or not the turnover crosses audit requirements.

I think that's a wrong interpretation if the profit is more than 6% then why would you show it at 6% as the officer would calculate your profit by asking for your sale purchase information from your share broker that your profit was more. So it's better to show correct profit or near it.

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Thank you

Hi,

Hope you are doing well !!

Techincally yes, you may get away with showing 6% income and paying peanuts as taxes. But it will be much, much better in long run if you declared your actual income and paid due taxes. That way you can fully enjoy your hard earned income.

As if your case is selected in scrutiny then the AO can definitely ask for your bank account statement.
Then based on bank balance and asset generated and on industrial standard may arrive at higher profit. As sec 44AD says 6% or more. So if one has profit above 6% then he should show that.

Thanks & Regards,

Payal Chhajed

Hi

Although there's nothing like non eligibility of this business for claiming presumptive taxation under section 44AD, but practically it is not advisable to claim 44AD having such a huge profit. Such claim clearly defies the main objective of 44AD. 

Also, this would create a huge gap in your actual income and income as per income tax, which again might be a red flag.

Dear Sir

You can pay 6% tax on the amount  received from Sale proceeds in Bank Account ,account payee cheque & Demand Draft but if your sale proceeds recd. other than ECS than minimum 8% tax on the amount recd.

Thanks & Regards

S.K.Agarwal

Gogia Ji

you cant go for presumtive tax scheme , coz presumtive says 6/8% or higher , here higher means if you have more then 6/8% profit then you have to pay tax on higher profit and if you have profit lower then 6/8% then eighter do Audit compliances or have to pay tax on minimum 6/8%. profit.

Yes , you can file your income-tax return on presumptive basis.  Certain things to be mindful of : THE F&O dealings should be your usual business and not one of transaction to be called as business income.  ALso, for future years, you should file return under this provision.