The presumptive taxation scheme under section 44ADA is to give tax relief to small taxpayers engaged in specified professions for example, legal, medical, engineering or architectural, accountancy, technical consultancy, interior decoration or any other profession as notified by CBDT.

Any business which has a turnover of less than Rs 2 crore can opt to be taxed presumptively. They must declare profits of 8% for non-digital transactions or 6% for digital transactions, whichever one is applicable.

If you opt for 44ad, Declare profit of 8% on your turnover.

Opt this option if your profit margin is more than 8%

Advantages: no books of a/c to be maintained, no audit, 


A professional (CA, doctor, architect, lawyers, interior designer etc.) having a gross revenue upto Rs 50 lakhs can opt for the presumptive scheme of tax wherein he can straightaway offer 50% of the gross revenue as his taxable income and pay taxes as per his slab rates on such income. Once he opts for this scheme, he cannot claim any of the profession related expenses as a deduction again.

Advantages: No books of a/c to be maintained, no audit 


So, for example, if your revenue for the previous year is, Rs 20 Lakh. But you need to pay tax only on 10 Lakhs. When we calculate tax according to new slab, for Rs 10 Lakh, it comes to Rs 78000/- only

Before you pay tax, take a step back and calculate the amount of tax to be paid as per presumptive taxation option. And, pay less tax.


Did you know about presumptive taxation before?


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