Income Tax for Businesses and Professionals
In order to calculate the income from business/profession, the taxpayer needs to subtract various business related expenses from the amount of gross receipts. This income can be taxed in either of the two ways:
- According to tax slab
- Presumptive Taxation Scheme (PTS): Businesses having a total turnover of less than Rs.2 crore and eligible professionals with gross receipts of less than Rs.50 lakh in a financial year are eligible for PTS. In this scheme, the taxpayer need not maintain proper books of accounts and has to show a fixed percentage of the gross receipts as income, and tax is calculated thereon.
