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What are the implications if I opt for the presumptive taxation scheme (PTS) for small businesses but declare profits at a rate lower than the required percentage, specifically less than 8% or 6% of turnover or receipts?

Nine O Six

If you declare profits at a rate lower than the 8% or 6% under the presumptive taxation scheme (PTS), then you are ineligible to opt for the PTS.

In such a case, you must maintain proper books of account U/s 44AA and undergo an audit conducted by a Chartered Accountant and then disclose your actual income in your income tax return, as per the Audited Books of Accounts.

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