Section 44AB vs 44AD vs 44ADA: Audit Rules and Presumptive Taxation

Where lower income is declared and income exceeds the exemption limit, audit becomes mandatory. No further deductions under Sections 30 to 38 are allowed once presumptive income is declared. Forced Exit from Presumptive Taxation on Exceeding Turnover Limit, Re-entry Allowed on Return8.1 “Forced Exit from Presumptive Taxation on Crossing Turnover Limit, with Re-entry Permitted When Turnover Falls Back Within Threshold”Examplea. Audit under Section 44AB(a) is mandatory, since turnover exceeds the audit threshold (₹10 crore if digital >95%, otherwise ₹1 crore). d. Fourth Year (Turnover ₹5 crore): Turnover exceeds the Section 44AD limit, so presumptive taxation cannot be used.