What is presumptive taxation under the Income Tax Act?

1
Presumptive taxation is a method of offering the
profits on a presumptive basis rather than the
actual basis. Under presumptive taxation, you can
offer a specific percentage or fixed amount as
income despite offering the actual income.
There is no fixed price or cost for registering
a Private Limited Company in India. There are
a number of dependent variables that determine
the cost of incorporation of a Private Limited
Company in India such as the location of
registered office, number of directors, amount
of authorised capital etc.
What is presumptive taxation under the Income
Tax Act?
How much does a Private Limited Company
Registration cost in India?
2
For example if your Sales is 1 crore, you may
offer 6 of the sales that is Rs.6 lakhs and pay
tax based on that instead of offering the actual
profits which may be higher say 30 lakhs.
Certain conditions are applicable for one to be
eligible to opt for presumptive taxation which
are detailed in sections 44 AD, 44 ADA and 44 AE.
3
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