When the professional receipts would exceed Rs 50 lakhs of the individual then the advantage of the Presumptive Tax under Section 44ADA. In that case, the individual is needed to create the profit and loss account and balance sheet and get his audit performed via a practising Chartered accountant.
Tax Compliance When Professional Income Exceeding INR 50 lakhs
Mentioned below are the compliances that are required to opt when the professional receipts exceed Rs 50 lakhs-
Prepare Books of Accounts Including Balance Sheet and Profit & Loss A/c
An individual would be needed to create the proper books of accounts including a Balance Sheet and Profit & Loss A/c and utilize ITR 3 form when the professional receipts of an individual are more than Rs. 50 Lakhs to file his ITR.
Tax Audit U/S 44AB Via Practising Chartered Accountant
Because his annual receipts exceed Rs. 50 lakhs, he must additionally have an Income Tax Audit performed by a practising Chartered Accountant. The CA will verify all facts and review copies of all invoices before preparing the Audit Report, which must be filed simultaneously with the Income Tax Return.
Deduction of TDS on the Particular Payments
TDS is needed to get deducted from the expenses as the annual receipts would exceed Rs 50 lakhs. An individual is needed to take a TAN no for the purpose of deducting and depositing the TDS.
Under the income tax act, the aforesaid complaints would be required to get implemented. Also as per the above-specified regulations, the individual is needed to perform the GST compliances including the receipts exceeding Rs 20 lakhs p.a.
Tax Calculation on Income & Charge on it
For the same case the income does not get calculated on the presumptive grounds however the same can get calculated on the actual grounds i.e.
Income = Receipts – Expenses – Depreciation
An individual needed to maintain a copy of all the expenses for getting the eligibility of claiming the expenses and depreciation.
Income tax is charged on the same income after the calculation of the income under the income tax slab rates and the highest slab rate of 30% shall be subject to be applied.
What is the Method to Save Income Tax?
The individual could indeed claim the advantage of the mentioned deductions i.e
- Home Loan Deduction
- Tax Deductions U/S 80C
- Tax Deductions for Education Loans
- Deductions for Health Insurance
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