Changes in presumptive taxation schemes - Budget 2023

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The amendments in relation to presumptive tax laws in Budget 2023 are a welcome change and have been largely appreciated by the taxpayer community.

 


Currently, businessmen with annual turnover less than Rupees 2 Crores and specified professionals with annual gross receipts less than Rupees 50 Lakhs are eligible to opt for presumptive taxation under sections 44AD and 44ADA.

The limits of sections 44AD and 44ADA have been revised upwards to Rupees 3 Crores and 75 Lakhs respectively.

 

Section

Nature of Income

Limit till FY 23

Limit for FY 24 and onwards

Section 44AD

Business

2 Crores

3 Crores

Section 44ADA

Profession

50 Lakhs

75 Lakhs

 

 

 

 

 

The enhanced limit is applicable only if the entire amount of cash received during the year does not exceed 5% of total gross receipts/turnover.

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