TaxTMI 
TaxTMI 
Section 44ad - Will only 6% or 8% be added to my capital?
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....ection 44ad - Will only 6% or 8% be added to my capital?<br> Query (Issue) Started By: - Nitin Goyal Dated:- 25-2-2018 Last Reply Date:- 7-8-2018 Income Tax<br>Got 1 Reply<br>Income Tax<br>I want to switch to ITR-4S under section 44AD. I am running an eligible business, no doubt on that. In the past years, my profit ratio has been well above 6% of the gross receipts, even upto 40% in some years, b....
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....ut it's very inconsistent. All my receipts are digital so I am eligible for presumptive income @ 6%. Assuming my gross digital receipt is 1 crore and I show presumptive income of 6 lakhs, and I had made a mutual fund investment of 20 lakhs. Can the IT department consider 14 lakhs (20-6) as my undisclosed income and impose penalty etc.? I don't even know the actual profit since I don'....
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....t maintain books, as relaxed by this provision. Now, my question is whether only ₹ 6 lakhs will be considered as my addition to the capital and any excess amount (out of the recorded digital turnover) found in my bank/investment will be considered as undisclosed income (liable for penalty etc.). If so, what is the main benefit of section 44AD? Is it just freedom from bookkeeping for the eli....
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....gible assesses, or should it be considered as a discounted slab in income tax, and any amount within the digital turnover could be considered as capital? Reply By DR.MARIAPPAN GOVINDARAJAN: The Reply: Section 44AD is not a discounted slab. It is applicable to eligible assessee doing an eligible business having turnover less than ₹ 2 crores.<br> Discussion Forum - Knowledge Sharing ....