Who can use Section 44AD?

Resident individuals, HUFs and partnership firms (not LLPs) carrying on an eligible business with turnover up to ₹2 crore, or up to ₹3 crore if cash receipts are 5 percent or less of total receipts. Professionals, commission agents and businesses of plying goods carriages (which use 44AE) are excluded.

What is the deemed income under 44AD?

8 percent of turnover, reduced to 6 percent for the portion received through banking channels, UPI or other digital modes by the return due date. You can declare a higher income. No further business expenses or depreciation are deductible, since they are deemed already allowed.

Who can use Section 44ADA?

Resident individuals and partnership firms (not LLPs) in notified professions, such as legal, medical, engineering, architecture, accountancy, technical consultancy, interior decoration, with gross receipts up to ₹50 lakh, or ₹75 lakh if cash receipts are 5 percent or less. Deemed income is 50 percent of gross receipts.

Do I need to maintain books or get an audit?

No, if you declare the presumptive income or more. If you declare less than the presumptive amount and your income exceeds the basic exemption, you must maintain books under 44AA and get a tax audit under 44AB. Opting out of 44AD also bars you from re-entering for five years.

How is advance tax paid under presumptive schemes?

In a single instalment of 100 percent by 15 March, instead of four instalments. Interest under 234C is charged for one month on any shortfall as at 15 March. See the advance tax calculator for the computation.

Presumptive Income Calculator

Deemed income under Section 44AD for small businesses and 44ADA for professionals, with the digital-receipt rate and turnover limits.

Switch tool

Scheme

8% of turnover, 6% on digital receipts. Limit ₹2 cr (₹3 cr if cash ≤ 5%).

Total turnover (₹)

₹

Of which received digitally / by bank (₹)

₹

Taxed at 6% instead of 8%. Also decides the ₹3 crore limit.

Income you wish to declare, if higher (₹)

₹

Deemed income

Cash receipts0.0% of total

₹ 0

Applicable limitcash ≤ 5%, higher limit

₹ 3,00,00,000

Eligible

—

6% on digital

₹ 0

8% on cash

₹ 0

Presumptive income

₹ 0

Income to declare

₹ 0

Indicative only. Sections 44AD and 44ADA. Eligibility also depends on residential status, entity type (LLPs excluded) and nature of business or profession. Tax on the income is at your slab rate.

How it works

Rate

44AD: 8% of turnover, 6% on the digitally received part. 44ADA: 50% of gross receipts.

Limits

₹2 crore / ₹50 lakh, rising to ₹3 crore / ₹75 lakh when cash is 5% or less of receipts.

No books, no audit

Provided you declare at least the presumptive amount.

What you must declare, and whether you qualify at all

Presumptive taxation trades bookkeeping for a deemed profit. Enter turnover or receipts and the digital share, and the calculator applies the right rate, checks the turnover limit that applies to your cash ratio, and shows the minimum income to declare. If you plan to declare less, it tells you what that triggers.

6% vs 8%

The digital-receipt concession under 44AD, applied per rupee.

Cash ratio test

Decides whether the enhanced ₹3 crore or ₹75 lakh limit is available.

Declare more, not less

Higher income is allowed; lower income brings 44AA books and 44AB audit.

Advance tax

One instalment by 15 March under both schemes.