To reduce the tax burden and to provide relief from tedious work to small tax assessees, the government of has incorporated a scheme of presumptive taxation. Businesses adopting the presumptive taxation scheme are not required to maintain regular books of account. They can declare the income at a prescribed rate.
Below are the type of asseesses who can adopt the provisions of presumptive taxation scheme under section 44AD:
1. Resident Individual Tax Payers
2. Hindu Undivided Families
3.Partnership Firm (except LLP or Limited Liability Partnership)
Below conditions are to be satisfied for adopting presumptive taxation scheme under Section 44AD of the Income Tax Act:
-The firm or individual's gross receipt or annual turnover in the previous year should not have exceeded Rs. 2 Crores.
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