Under presumptive taxation, your 50% of the receipt will be counted as taxable income. So, If your income is 890000, Your taxable income is 445000. and your tax will be computed on 445000. It cant be further reduced (unless you have deduction for investment)
Presumptive tax for consultant architect- 44ADA
Hello Ma'am/ Sir, I am an architect and working as a consultant in an architecture firm in Mumbai. I am not on payroll but this is company is the sole source of income. I produce my bill to the firm to get the salary in my account. 10% TDS is cut every month. I have been issued form 16 A for 4 quarters. I have already paid 90000 as TDS. I have made some investment and have medical insurance too. I am not given any HRA. So, if I file my ITR under ITR 4 of 44ADA, I get approx 89000 of my TDS. Whereas if I file normal ITR I get 2000 approx refund. Kindly suggest if I am right in going forward with this 44ADA. Or else suggest ways to get max tax refund. Thanks
Asked 8 years ago in Income Tax
Hi,
Yes, you can opt for section 44ADA commonly known as presumptive taxation. In this case, 50% of your gross receipts will be taxable.
You can go ahead with presumptive taxation.
Please feel free to call revert in case you need more clarity
Thanks and regards
Abhishek Dugar
CA CS B.Com
Hi,
You have said 90,000 is the TDS. So, I assume your Turnover is 9 Lakhs. Since, the Turnover is well below Rs. 50 Lakhs, you are eligible for claiming Section 44ADA benefit. Declare 50% or higher as the Profit and pay taxes on the same.
You are eligible for 44ADA benefit. If that results in higher Refund, you are eligible to claim the same.
Dear Experts, Thanks for your advises. I have few more queries. 1. If my salary as a consultant fixed by my company is 900000, so in the section income detail while filing tax return in column B1, income from business & profession (E8 of sch BP) should be (50% of total salary including TDS) 450000 or 900000 2.In NOB(nature of business) BP, I have selected 703- Consultancy service, and trade name Architect. Is this correct. 3.Computation of presumptive income under 44ADA. Gross receipt I have mentioned 900000 and presumptive income I have mentioned 450000. Is this correct? 4. What is E9-E12, i.e, Amount of total sundry debtors, amount of total sundry creditors, Total stock in hand, cash balance. I have kept it 0. Is it correct. 5. I have checked 6% instead of 8% for calculating profit, as all my salary is credited through cheque in my account. Need urgent advise. Any other comments and advise most welcome. Thanks & Regards, AK
Asked 8 years ago
Already answered all the above queries in a separate question.
Hi,
Below are my answers to each point
1. It should be 50% of Rs. 9 Lakhs - 4.5 Lakhs
2. I would suggest to use Professsional - Others. Trade name to be entered only if there is a Trade Name. I guess you are receiving the amount as an individual architect. So, leave Trade name Blank
3. Correct
4. Declare approximate Cash-in-hand as on 31-Mar-2017
5. The option of 6% or 8% is applicable for Section 44AD. Not for 44ADA
Hello,
The entire form is corrrect.
You need not check 6-8% since that is for retailers and not professionals.
Trust this clarifies your query.
Feel free to call / get back in case of further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, ACA, LLB-GEN, CERT. FAFP
Hi,
It appears that your first set of questions have already been answered. Regarding your second set of questions, we would require the entire form for our perusal.
Regards,
Keerthiga Padmanabhan
M.Com., CA, LL.B
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