44AD Presumptive Tax Calculator

Calculate your presumptive business income under Section 44AD and compare tax under the old and new regimes.

Your business details

Gross turnover: ₹50,00,000

Received digitally: 100%

Entity type

Other income: ₹0

Chapter VI-A deductions (old regime only): ₹0

Presumptive income

Presumptive income (44AD)

₹3 Lakhs

₹3,00,000

6% of digital turnover + 8% of cash turnover

Tax comparison

Both regimes are equal

New regime

Taxable income₹2,25,000

Total tax₹0

Monthly take-home₹25,000

Effective rate0%

Old regime

Taxable income₹2,50,000

Total tax₹0

Monthly take-home₹25,000

Effective rate0%

New regime tax

₹0

0% effective

Old regime tax

₹0

0% effective

If you opt out of Section 44AD before 5 consecutive years, you cannot use presumptive taxation again for the next 5 years, and a tax audit becomes mandatory for that period.

Frequently asked questions

Resident individuals, HUFs, and partnership firms (not LLPs) running an eligible business, with turnover up to Rs 2 crore, or up to Rs 3 crore if at least 95% of receipts are digital or through banking channels. Companies and LLPs cannot use this scheme.

The lower 6% rate on digitally received turnover was introduced to encourage electronic payments and reduce cash transactions. Cash receipts are still presumed at the original 8% rate.

No. The presumptive income already accounts for all business expenses, so you cannot claim depreciation or other business deductions on top of it. You can still claim Chapter VI-A deductions like 80C and 80D under the old regime.

If you declare income under 44AD in one year and then opt out in a later year, before completing 5 consecutive years in the scheme, you cannot use presumptive taxation again for the next 5 assessment years, and you become subject to a mandatory tax audit for that period.

You can declare a lower actual profit instead of the presumptive rate, but if your income exceeds the basic exemption limit, you will then need to maintain proper books of account and get them audited, which is exactly what 44AD is meant to help you avoid.

Section 44AD is for business income (trading, manufacturing, and similar), with a 6-8% presumptive rate. Section 44ADA is for specified professions (doctors, lawyers, consultants, and similar), with a higher 50% presumptive rate reflecting typically higher profit margins. Use the 44AD vs 44ADA vs Regular Comparison Calculator to see both alongside your actual numbers.

Related calculators

Figures are for FY 2025-26 (AY 2026-27) and are for planning purposes only, not tax filing advice. Eligibility thresholds and presumptive rates are set by the Income Tax Act and may change in future Finance Acts, verify against the current year's rules before filing.

44AD Presumptive Tax Calculator

Calculate your presumptive business income under Section 44AD and compare tax under the old and new regimes.

Your business details

Gross turnover: ₹50,00,000

Received digitally: 100%

Entity type

Other income: ₹0

Chapter VI-A deductions (old regime only): ₹0

Presumptive income

Presumptive income (44AD)

₹3 Lakhs

₹3,00,000

6% of digital turnover + 8% of cash turnover

Tax comparison

Both regimes are equal

New regime

Taxable income₹2,25,000

Total tax₹0

Monthly take-home₹25,000

Effective rate0%

Old regime

Taxable income₹2,50,000

Total tax₹0

Monthly take-home₹25,000

Effective rate0%

New regime tax

₹0

0% effective

Old regime tax

₹0

0% effective

If you opt out of Section 44AD before 5 consecutive years, you cannot use presumptive taxation again for the next 5 years, and a tax audit becomes mandatory for that period.

Frequently asked questions

The lower 6% rate on digitally received turnover was introduced to encourage electronic payments and reduce cash transactions. Cash receipts are still presumed at the original 8% rate.

Related calculators

44AD Presumptive Tax Calculator

Frequently asked questions

Who can use Section 44AD?

Why 6% for digital receipts and 8% for cash?

Can I claim business expenses separately under 44AD?

What happens if I opt out of 44AD before 5 years?

What if my actual profit is lower than the presumptive 6-8%?

How does this compare to 44ADA?

44AD Presumptive Tax Calculator

Frequently asked questions

Who can use Section 44AD?

Why 6% for digital receipts and 8% for cash?

Can I claim business expenses separately under 44AD?

What happens if I opt out of 44AD before 5 years?

What if my actual profit is lower than the presumptive 6-8%?

How does this compare to 44ADA?