1. Tax on what amount?
- Tax on actual profit of Rs. 50 lakh, NOT 6% of turnover
2. Excess profit - unreported income?
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Yes - declaring only Rs. 6 lakh (6% of Rs. 1 crore) when actual profit is Rs. 50 lakh = Rs. 44 lakh unreported income - Risk of penalties and scrutiny
3. Ways to save tax?
- Claim legitimate business expenses (brokerage, internet, professional fees)
- Employee salary (must be genuine)
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Under 44AD you can’t separately deduct salary/expenses; to deduct expenses you must shift to regular books and declare actual profit.
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