Select other services.
Section 44AD Defective Return
Hi, I received a income tax notification today morning on 'Defective Return' and the details mentioned there were due to Section 44AD. My business deals with providing Digital Marketing Services and 1. I would like to reconfirm if this is allowed in Section 44AD (as it does not relate to agency / commission). 2. During the return filing, what is the 'Nature of Business' should I select for allowance of Section 44AD
Asked 6 years ago in Income Tax
Since you are providing service of advertising you are into a profession and I think you must select 44ADA with code 16006 and show 50% of your receipt as income.
If you need any help in return filing do contact.
Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.
Thank you
Hi Last year we filed under the 'Nature of Business' (Code: 05-05) and this got allowed but this year since the codes have changed, we put Software Consultancy - Other (14002) - Could this be the reason for disallowance? The error by CPC clear mentions Section 44AD cannot be applied for my type of business, so I assume there is an issue with the chosen business code? If my understanding is correct, could someone please suggest the exact code for my nature of business that would be allowed under Section 44AD. I also understand from someone, ITR-3 needs to be filed to solve this problem. Could someone please throw some light on this?
Asked 6 years ago
Last year you filled the business code for contractors which is considered as business.
I think as per the business code for AY 2018-19 most apt would be advertising covered under professional.
Why is ITR 3 required to be filed?
Any reason for that because I don't see any reason for that.
It is better to file ITR-3.
Hi,
Can you describe more what do you exactly do in digital marketing.
Prima facie, it appears that your services will qualify of section 44ADA and not for 44AD.
Code will depend upon the exact services you provide.
No, you can file ITR 4 if you want to adopt 44ADA
The code 14002 for software consultancy falls under 44ADA and not 44AD.
You need to revise the return with proper code and proper claim of presumptive taxation. Describe nature of your work to decide the same.
Dear Sir,
Hope you are doing well !!
Could you please share the nature of services provided by you in digital marketing?
The ITR-4 Form is the Income Tax Return form for those taxpayers, who have opted for the presumptive income scheme as per Section 44AD, Section 44ADA and Section 44AE of the Income Tax Act. However, if the turnover of the business mentioned above exceeds Rs 2 crores, the taxpayer will have to file ITR-3.
Hi
14005(others IT enabled services) can be used.
Further more information regarding exact nature of work will be required for detailed answer.
Hope it helps
Ask a Chartered Accountant
Get tax answers from top-rated CAs in 1 hour. It's quick, easy, and anonymous!
Ask a CA