This blog post addresses a common but serious error made by professionals and freelancers who incorrectly file their income tax returns under Section 44AD (for businesses) instead of the appropriate Section 44ADA (for professionals). It explains the fundamental differences between the two sections, how the Income Tax Department's AI systems detect this discrepancy through TDS mismatches and unusually low-profit declarations, and the severe consequences that follow, including mandatory audits and multiple financial penalties. The article concludes by offering a clear, step-by-step guide on what to do if you receive a notice for this mistake, emphasizing the importance of consulting a professional and taking prompt corrective action.

For small businesses and professionals in India, understanding Sections 44AA, 44AB, 44AD, and 44ADA of the Income Tax Act, 1961, is essential for smooth tax compliance. This guide explains how these sections apply for the Financial Year 2024-25 (Assessment Year 2025-26). It covers necessary bookkeeping, tax audit rules, and the simplified presumptive taxation schemes that can greatly lessen the compliance burden for qualified taxpayers.

This blog explains the key differences between ITR-3 and ITR-4, specifically for freelancers and consultants, outlining eligibility criteria and scenarios to help them choose the correct income tax return form.

This comprehensive guide delves into Section 44ADA of the Income Tax Act, 1961, offering a simplified "presumptive taxation" scheme for eligible self-employed professionals. Discover who qualifies, how to calculate your taxable income at a minimum of 50% of gross receipts, and the significant benefits like exemption from detailed bookkeeping and tax audits. Learn about crucial compliance aspects, including advance tax and the increased ₹75 Lakhs gross receipts limit, to make informed decisions for smarter tax planning and effortless compliance.

This post offers an in-depth overview of key Income Tax Act sections (44AA, 44AB, 44AD, 44ADA) applicable for AY 2025-26 (FY 2024-25). It details the requirements for maintaining accounting records and mandatory tax audits based on income/turnover thresholds. It also explains the presumptive taxation schemes for eligible small businesses (44AD) and professionals (44ADA), including updated limits and the implications of opting for or out of these schemes. The guide aims to clarify compliance duties for taxpayers

This blog explains how opting for presumptive taxation under Sections 44AD (businesses) and 44ADA (professionals) simplifies Advance Tax obligations, requiring only a single payment by March 15th instead of quarterly installments. It covers eligibility, calculation, and non-compliance consequences.

For the fiscal year 2025–2026, this blog offers a comprehensive guide on Sections 44AA, 44AB, 44AD, and 44ADA of the Income Tax Act. Bookkeeping, presumptive taxation schemes, tax audit requirements, and compliance advice for professionals and corporations are all covered.