Tax incentive for cash less transaction: Deemed profit to be reduced from 8% to 6% u/s 44 AD:
New Delhi, 19th December, 2016.
Press Release
Measures for Promoting Digital Payments & Creation of Less-Cash Economy
Under the existing provisions of section 44AD of the Income-tax Act, 1961 (the Act), in case of certain assesses (i.e. an individual, HUF or a partnership firm other than LLP) carrying on any business (other than transportation, agency, brokerage and commission) and having a turnover of Rupees Two Crore or less, the profit is deemed to be 8% of the total turnover.
In order to achieve the Government's mission of moving towards a less cash economy and to incentivise small traders / businesses to proactively accept payments by digital means, it has been decided to reduce the existing rate of deemed profit of 8% under section 44AD of the Act to 6% in respect of the amount of total turnover or gross receipts received through banking channel / digital means for the financial year 2016-17. However, the existing rate of deemed profit of 8% referred to in section 44AD of the Act, shall continue to apply in respect of total turnover or gross receipts received in cash.
Legislative amendment in this regard shall be carried out through the Finance Bill, 2017.
(Meenakshi J. Goswami)
Commissioner of Income Tax
(Media and Technical Policy)
Official Spokesperson, CBDT.
India moves towards a digital revolution. Now it's been changing for a long time. As for the completion process, it makes a stir in public mind. This digital change is a major part of our population.
ReplyDeleteTo encourage the public to absorb the digital transaction role, the government has provided discount, incentives and free payments. But still there are still digital signals and suspicions of payment.They still do not know the many benefits they can enjoy if they still decide to spend money. If you are one of them, you have to pay for 9 reasons now:
When you have paper bills in your pockets sitting with those heavy tailings, you do not have to face more inconvenience. Keep your money in the bank and join millions of people who enjoy digital transactions using credit cards, debit cards, mobile wallets, UBI applications, and USSD Bank.You do not have to stand in long queues of numerous ATMs. Pay your plastic money swap or QR code to make your purchase.
If you stop digital payments and transaction systems, you're definitely a fan of online shopping. One of the most acclaimed benefits of paying is easy to make money transaction.
The government can clean up your bank account by pressing a button. If there is another financial crisis, the banks can bind themselves to your savings. For us today there is a sucker game for little people and Trump its worse. Each penny is responsible. Less corruption, less black money, less money and low terrorism. Fast transactions do not have the fear of stealing that there is no need to take a huge amount of money.VISIT HERE GST Registration
Yes ... you may not be in trouble. Like a service tax regime, you can register for a home address, as well as a home address in GST.
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