Tax
Presumptive Taxation
Also known as: Section 44AD, Presumptive Scheme
A simplified tax scheme where profits are presumed as a percentage of turnover, avoiding detailed bookkeeping.
Detailed Explanation
Presumptive taxation under Section 44AD allows businesses with turnover up to ₹2 crore to declare minimum 6% of turnover as profit, regardless of actual results. For F&O traders, this eliminates the need for detailed books of accounts and audit requirements, making tax compliance simpler for small traders.
Related Terms
Section 44AD
Income tax provision allowing presumptive taxation for eligible businesses with turnover up to ₹2 crore.
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Turnover
For F&O taxation, the sum of absolute profits and losses from all trades during the financial year.
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Audit Threshold
Income or turnover limits beyond which mandatory tax audit is required.
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