ITR
Commission agents and presumptive income
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Facts
Sec 44AD does not apply to income from commission or brokerage, or to agency business. It also does not apply to specified professions. Insurance agents therefore usually cannot use 44AD.
Provisions and law
- Sec 44AD (now Sec 58)Presumptive business income at 6% of digital and 8% of other receipts for eligible businesses
- Sec 194D (now Sec 393)TDS on insurance commission
Analysis
Commission income of ₹8,00,000 from an insurer is business income computed under normal rules, deducting actual expenses such as travel and office costs. You file ITR-3, and if your income is within limits, no audit is needed. TDS on the commission shows in 26AS and is claimed in the return.
Conclusion
- Confirm the income is commission or brokerage
- Compute actual profit with expenses
- File ITR-3 and claim TDS
- Check audit limits if receipts are high
A Savvy can do this for you
Presumptive income tax return, ITR-4 (Sugam), Sec 58 (old 44AD, 44ADA, 44AE)
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