Section 44ADA Calculator
Presumptive taxation for professionals — half of gross receipts, taxed, with no books to keep.
A cheque or draft that is not account-payee counts as cash for this test. Only account-payee instruments and electronic modes fall outside it.
- Gross receipts
- ₹30,00,000.00
- Expenses deemed allowed, without proof
- ₹15,00,000.00
- Ceiling that applies to you
- ₹75,00,000.00
- Income you are taxed on
- ₹15,00,000.00
- Deemed expenses
- ₹15,00,000.00
- Tax
- ₹1,09,200.00
- Kept from presumed income
- ₹13,90,800.00
FY 2026-27 (AY 2027-28). Presumptive taxation for professionals now lives in section 58 of the Income-tax Act 2025, which merges the old sections 44AD, 44ADA and 44AE; the 50% presumption and the ceilings are unchanged. The ceiling is ₹50,00,000.00, rising to ₹75,00,000.00 when cash receipts are 5% or less of the total. It is open to a resident individual, HUF or partnership firm — not an LLP or a company — carrying on a notified profession: legal, medical, engineering, architectural, accountancy, technical consultancy, interior decoration, company secretary, information technology, authorised representative or film artist. A general "consultant" outside those categories does not qualify, even where tax was deducted under section 194J, and that is the most common wrong claim. Two things in your favour: advance tax is a single instalment by 15 March, which caps deferment interest at 1% for one month instead of the four-instalment schedule; and unlike section 44AD for businesses, there is no five-year lock-in, so you may opt in and out year to year. Declaring less than 50% while your income exceeds the exemption limit means keeping books and being audited. Once you are in, the presumed figure is final — no separate claim for expenses or depreciation on top.
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How it works
Presumptive taxation lets a professional declare half of gross receipts as profit and pay tax on that, with every expense deemed already allowed and no books to maintain. It used to be section 44ADA; the Income-tax Act 2025 folded it, along with the business and goods-carriage schemes, into a single section 58. The presumption and the ceilings did not change.
The ceiling is ₹50 lakh of gross receipts, rising to ₹75 lakh when cash receipts are 5% or less of the total. Note what counts as cash for that test: a cheque or draft that is not account-payee is treated as a cash receipt, so only account-payee instruments and electronic modes keep you under the line.
Two features are easy to overlook. Advance tax is a single instalment due by 15 March rather than four across the year, which caps deferment interest at 1% for one month. And unlike the business scheme, there is no five-year lock-in — a professional may opt in and out year to year as it suits them.
Presumed income = 50% of gross receipts, provided gross receipts are within ₹50,00,000 (or ₹75,00,000 when cash receipts are at most 5% of the total).Tax is then computed on the presumed income under whichever regime you choose. The standard deduction does not apply, because presumptive income is business income rather than salary. Depreciation is deemed already claimed, and the asset's written-down value is reduced as though it had been.
Frequently asked questions
Who can use Section 44ADA?
A resident individual, HUF or partnership firm — not an LLP and not a company — carrying on a notified profession: legal, medical, engineering, architectural, accountancy, technical consultancy, interior decoration, company secretary, information technology, authorised representative or film artist. A general consultant outside those categories does not qualify even if tax was deducted under section 194J, and that is the most common wrong claim.
Is there a lock-in if I opt in?
No, and this is where the business scheme differs. Section 44AD, for businesses, bars you for five assessment years if you opt out after opting in. Nothing equivalent applies to professionals: you may use the presumptive scheme in one year and not the next, freely. Advice that mentions a five-year lock-in for professionals is describing the wrong section.
What if my actual profit is less than 50 percent?
You may declare the lower figure, but doing so while your total income exceeds the basic exemption limit means you must maintain books of account and have them audited. For many professionals the cost and inconvenience of that outweighs the tax saved, which is the practical reason the 50% presumption is usually accepted even when real margins are thinner.
Can I claim expenses on top of the presumption?
No. The presumed figure is final: all deductions for expenses and depreciation are deemed already allowed within it, and a partnership firm cannot separately claim partner salary or interest either. That is the trade — no proof of expenses required, but no further claim on top. Deductions under Chapter VIII, such as section 123 or the health-insurance deduction, remain available under the old regime.