Presumptive Taxation and Simplified Schemes under Income Tax Act 2025

Presumptive taxation under the Indian Income-tax Act is a simplified taxation scheme for small businesses, professionals, and transport operators, where income is calculated on a fixed presumptive basis instead of maintaining detailed books of accounts. Under Section 44AD, eligible small businesses can declare income at 6% or 8% of turnover; under Section 44ADA, specified professionals can declare 50% of gross receipts as income; and under Section 44AE, transporters can declare income on a fixed per-vehicle basis. These schemes reduce compliance burden, simplify return filing, and help taxpayers avoid tax audit subject to prescribed conditions.