Can we file the return under section 44AD of an assessee if he has the trading business and also a profession.

For example one of the client has a tailoring shop and also a saree store, can he file ITR-4 for showing both the incomes.

What i am thinking is, i will file the ITR-4 showing Pl and BS details of tailoring and direct profit in case of trading business.

Is it allowed under section 44AD?

Posted 2 years, 6 months ago by Rahul Rai


Another question is, whether tailoring is profession or business?

Assessee has employeed few people to do the tailoring and sewing but he himself is not engaged in work.

Whether owning a tailoring shop is profession or business?

Posted 2 years, 6 months ago by Rahul Rai


Section 44AD allows you to declare income at 8% or more and no need to maintain the books of accounts. Only Eligible Assessee having eligible business can apply provisions of this section.

Tailoring is not a profession but business, tailoring is not specified as profession under section 44AA and neither specified as profession by board.

As per my opinion, you can classify tailoring as business and file return under section 44AD.

However to arrive at the amount of 1 crore, you have to club the turnover of both business.

Posted 2 years, 6 months ago by CA Pulkit Sharma


Thank you.

Posted 2 years, 6 months ago by Rahul Rai


You can combine the turnover from both the business & declare the profit @ 8% or a sum higher than the aforesaid sum claimed to have been earned by the eligible assessee. Any deductions allowable u/s 30-38 shall be deemed to have been allowed except for interest & salary of the partners as covered u/s 40(b).

Posted 2 years, 6 months ago by Mukesh Jain CA


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