Section 44AD
Definition
A presumptive taxation scheme letting eligible small businesses in India declare income at a prescribed percentage of turnover instead of maintaining detailed books. A lower percentage applies to digital receipts to encourage non-cash turnover.
Why it matters
Presumptive taxation removes most bookkeeping and audit burden for small businesses, but opting in and out has multi-year consequences that should be weighed before choosing it.
Related Terms in India GST
Section 44ADA
A presumptive taxation scheme for eligible professionals in India, allowing income to be declared at a prescribed percentage of gross receipts up to a turnover limit, without maintaining full books of account.
Section 44AB (Tax Audit)
The provision requiring a tax audit of accounts where a business's or professional's turnover or receipts exceed prescribed limits, or in certain presumptive-scheme situations. The audit report is filed in the prescribed form before the return.
Section 80C
A deduction under India's old tax regime for specified investments and payments — such as life insurance premiums, provident fund, ELSS and certain tuition fees — up to an annual ceiling, reducing taxable income.
Section 80D
A deduction for health-insurance premiums and certain preventive health check-up and medical expenses in India, with separate limits for self and family and for senior-citizen parents.
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