Please Help: Applicability of Section 44AD in the case of Guest House Business?
Posted Date : 24-Sep-2013 , 10:01:11 am | Posted By: Suraj
Category :
Income Tax | Answers :
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Comments :
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Dear Sir,
We have a client whose business income is from running a guest house. Its Turnover is less than Rs.1 crore and also profit much below 8 percent. Will this be taxed under presumptive basis under section 44AD as under this section it is stated that "In the case of eligible assesse engaged in an eligible business the sum equal to 8 % of the turnover to be taken as taxable income".
or Tax Audit is required?
Kindly Clarify
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Answers:
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 Answer by: Vaneet Gupta |
| Yes either Presumptive Income or Audit to be done
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| Answer by: Vaneet Gupta |
| Yes either Presumptive Income or Audit to be done
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| Answer by: Vaneet Gupta |
| Yes either Presumptive Income or Audit to be done
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| Answer by: SUBHASH KUMAR JHA |
| According to section 44AD of income tax act an assessee engaged in business having turnover of less than 1 crore can opt for presumptive taxation scheme and it opt this and they don't need either to maitian the books of accounts or gets their account audited.
but if under PTS income is coming more than the income computed under normal provision then assessee will definitely go for normal provision and in this case assessee will have to maintain books of account and get their account audited.
so now choice will be yours :
either go to PTS and dont maintain books of account , dont get account audited
or go for normal provision and maintain books of account , get account audited
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| Comments |
| Posted By : S K TAJ |
03-Oct-2013, 10:31:57 |
| If a person claims that the profit and gains form business 0r profession are lower than as specified in 44AD (i.e 8%) and his total income is more than taxable income than the person is liable to audit u/s 44AD ( for example you are individual and sales is 90,00,000/- and 44AD is 7,20,000/- and you are showing profit @ 4 % 3,20,000/- then you are liable to Tax audit u/s 44AB) |
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| Posted By : |
25-Sep-2013, 11:15:56 |
| As per Sec 44 AB an assessee has to get it accounts audited if the turnover is more than 1 crore or in case of profession, receipt is more than 25 lakhs. and if an assessee is showing is a profit less than presumptive basis defined under section 44 AD i.e 8% than also the assessee has to get its accounts audited and assessee is to maintain proper books of accounts defined under section 44 AA and audit is to be done under section 44AB. |
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| Posted By : Amit Sharma |
25-Sep-2013, 11:03:22 |
| u/s 44AB(d) if the profit & gains from the business are deemed to be the profit & gains of such person u/s 44AD & he has claimed such income to be lower than the profits & gains so deemed to be the profits & gains of his business then such books of accounts needs to be audited. |
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