Presumptive Income Tax Filing

Documents To Be Submitted

Bank statements for the financial year

Income and Expense statements

Gross Receipts

Form 26AS Tax Credit Statement

Bank statement if interest received is above Rs. 10,000/-

FAQs

Who can opt for the presumptive taxation scheme?

Only proprietors, Hindu Undivided Families (HUFs) and general partnership firms can opt for the scheme. Presumptive scheme for professionals is not applicable to HUF, only presumptive scheme for Business is applicable.

What are the benefits under Presumptive Taxation Scheme?

The benefits include:

No requirement to maintain books of accounts

No requirement to get accounts audited

No need to assess advance tax, advance tax is paid by 15th March of the previous year. 

Note: Any amount paid by way of advance tax on or before 31st day of March is also treated as advance tax paid during the financial year ending on that day. Note: The scheme applies only to resident assessee who is an individual, HUF, partnership but not limited liability partnership.

I am a shopkeeper and wish to declare income less than 8% of my gross turnover. How can i do that?

If you declare income less than 8% of turnover and your income exceeds Rs. 2,50,000 (Individual Tax Slab), then you are required to maintain the books of account as per the provisions of section 44AA and has to get accounts audited as per section 44AB.

I am an insurance agent and my gross receipts are Rs. 40 lakh. Am i eligible under presumptive taxation scheme?

There are certain businesses which are explicitly not allowed to claim the benefits under the scheme. They include:

Any business involved in the renting, hire or plying of goods carriages

Any business related to agencies

Individuals who receive commission or income related to brokerage

Any individual who is involved in any profession mentioned under section 44AA(1)

Insurance agents, since any income they receive is via commission

Can I file a revised return to correct a mistake in original return filed?

Yes, return can be revised within a period of one year from the end of the relevant assessment year or before completion of the assessment whichever is earlier. Filing of revised return is not part of the plan. Plan buyer is required to provide full and accurate details to avoid the need for any rectification in the originally filed return.

Am I required to keep a copy of the return filed as proof and for how long?

Yes, under the Income-tax Act legal proceedings can be initiated up to 4 to 6 years (depending upon case to case) prior to the current financial year.

However, in certain cases the proceedings can be initiated even after 6 years, hence, it is advised to preserve the copy of return for at least 6 years or maintain it as long as possible.