Frequently Asked Questions
Section 44ADA is a presumptive taxation scheme for professionals (doctors, lawyers, CA, architects, freelancers in IT/design/writing). If gross receipts are ≤ ₹75 lakhs, 50% of receipts is taken as presumptive income. No books of accounts required.
Resident individuals, HUFs, and partnership firms (not companies or LLPs) in specified professions: legal, medical, engineering, architecture, accountancy, technical consultancy, interior decoration, and other notified professions. Freelancers in IT and creative services typically qualify.
Yes, if your expected tax liability exceeds ₹10,000 in a year, you must pay advance tax in 4 installments: 15% by June 15, 45% by September 15, 75% by December 15, and 100% by March 15.
Old regime is beneficial if your deductions (80C + 80D + HRA + other) exceed ~₹3.75 lakh. New regime (default from FY 2026-27) is simpler and better if you have fewer deductions. Calculate both to compare.
About this calculator
Section 44ADA is a presumptive tax scheme for professionals such as doctors, lawyers, architects, accountants, engineers and many freelancers. Instead of keeping full books, you declare 50% of your gross receipts as profit and pay tax on that. The other 50% is treated as your expenses, whatever you actually spent.
This calculator takes your receipts, your regime and your deductions, and works out the taxable income, the tax with cess and an advance tax schedule. It is built for freelancers in design, development, writing, consulting and similar fields, where real expenses are usually well below 50% and the scheme saves both tax and paperwork.
How to use it
- Enter your Gross Receipts for the year.
- Enter your actual Expenses if you want to compare with the normal method.
- Choose the Tax Regime.
- If you choose the old regime, enter 80C, 80D and NPS deductions.
- Press Calculate Tax.
Presumptive income and tax
Presumptive income = 50% × Gross receipts. In the old regime, Taxable income = Presumptive income − 80C − 80D − NPS. In the new regime, deductions do not apply and the first ₹12 lakh of taxable income is rebated to zero tax (professionals do not get the salaried standard deduction). Tax is computed on slabs, with surcharge as applicable and 4% cess. The scheme is open to resident individuals, HUFs and partnership firms (not LLPs) with receipts within the limit, which is ₹50 lakh, or ₹75 lakh if at least 95% of receipts come through banking channels.
Worked example
Receipts ₹20,00,000, old regime, 80C ₹1.5 lakh, 80D ₹25,000, NPS ₹50,000
| Presumptive income (50%) | ₹10,00,000 |
| Deductions | ₹2,25,000 |
| Taxable income | ₹7,75,000 |
| Tax with cess | ₹70,200 |
Under the new regime the same ₹20 lakh of receipts gives taxable income of ₹10 lakh and no tax, because it sits within the ₹12 lakh rebate limit. The new regime wins here.
Tips and common mistakes
- If your real expenses are higher than 50%, use the normal method with books and an audit instead. Compare both.
- You must file ITR-4 and pay advance tax once by 15 March under the presumptive scheme.
- If you declare profit below 50% of receipts while your total income is above the basic exemption limit, you must keep books and get an audit done.
- Do not forget GST. Registration is mandatory above ₹20 lakh of service turnover (₹10 lakh in special-category states), whatever your income tax scheme.
- Keep invoices and bank statements. A notice can ask you to show receipts even if no books are required.
Frequently asked questions
What is Section 44ADA?
A presumptive tax scheme under which eligible professionals declare 50% of their gross receipts as income, with no books of account needed.
Who can use 44ADA?
Resident individuals, HUFs and partnership firms other than LLPs, carrying on a specified profession, with receipts within the limit.
What is the receipts limit?
₹50 lakh, rising to ₹75 lakh if at least 95% of receipts are received through banking channels or digitally.
Can I claim extra expenses under 44ADA?
No. The 50% presumption covers all business expenses. You may still claim deductions such as 80C in the old regime.
When do I pay advance tax?
Presumptive taxpayers can pay the whole advance tax by 15 March instead of in four instalments.
Which ITR form do I use?
ITR-4 (Sugam).