Return under 44AD by a partnership firm having loss

[Sanjeev Agrawal]

Whether a partnership firm can file return U/S 44AD for AY 2017.18 with a business turnover of ₹ 90 lakh and loss of ₹ 10000,without getting accounts audited under section 44 AB..after paying interest on capital to partners and remuneration as per partnership deed..section 44AD(2) prohibits deductions under section 30 to 38 but not under section 40 (b)...the income in this case is below the maximum amount which is not taxable...

[Kishan Barai]

In partnership firm, separate returns have to be filed by firm and partners, even if there is loss nil return has to be filed.

[Nandan Khambete]

Yes.Partnership firm can file U/s 44AD even if actual loss is ₹ 10,000/-. This will avoid denial of 44AD exemption in subsequent years due to discontinuing of 44AD benefit.

AI Summary

Presumptive taxation under section 44AD can be adopted by partnership firms despite actual business losses, avoiding audit triggers. A partnership firm may elect the presumptive taxation regime and file return under section 44AD even if actual business results show a loss; the election applies the deemed profit computation and excludes certain business deductions while payments like interest on capital and partners' remuneration remain matters of internal distribution. The firm must file its own return even when reporting a loss, and the choice to adopt the presumptive basis affects future compliance and audit obligations.