TaxTMI 
TaxTMI 
If I am showing income under section 44AD of the Income Tax Act, i.e Income @ 8 % or more of the Gross Receipts, would it matter If the cash withdrawals from the account are insufficient to cover the deemed expenses ? I personally feel that this should not matter as the deeming provisions itself state that books of accounts need not be maintained. Pleas offer your opinions.
Deeming Income Provisions
18 Sep 2011 
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Presumptive taxation deeming income: gross receipts treated as deemed income regardless of cash withdrawals, provided turnover is correct.
Under the deeming mechanism a fixed proportion of gross receipts under section 44AD is treated as taxable income and the remainder as provision for expenses without reference to actual expenditures or cash flows; insufficient cash withdrawals do not affect the presumptive computation, though reported turnover must be correct. (AI Summary)
Under the deeming mechanism a fixed proportion of gross receipts under section 44AD is treated as taxable income and the remainder as provision for expenses without reference to actual expenditures or cash flows; insufficient cash withdrawals do not affect the presumptive computation, though reported turnover must be correct. (AI Summary)