Chartered Accountant · ICAI M.No. 153926 · FRN 136869W · Reviewed on 13 October 2026
The presumptive road: simple, and final
Receipts up to ₹50 lakh (or ₹75 lakh where cash receipts stay within 5%) can be declared at 50% under 44ADA — no books, no audit, no expense schedules. The trade-off is absolute: a doctor whose true costs run at 60% of receipts is over-paying tax for the convenience, and one who declares below 50% while income exceeds the exemption invites books and audit under 44ADA(4).
The books road: what a practice typically claims
Clinic rent and electricity, staff and locum salaries, depreciation on medical equipment and furniture (with the Act’s rates), consumables and medicines used in treatment, professional indemnity premium, council fees, journals and CME/conference costs with a professional purpose, car and phone to the extent used for the practice. Receipts-side honesty matters equally — cash OPD collections are the first thing a survey tests.
The traps that undo genuine claims
Cash payments above ₹10,000 a day to one person are disallowed under 40A(3); rent, professional fees and salaries attract TDS once the practice crosses the audit thresholds, and defaults trigger 30% disallowance under 40(a)(ia); personal elements in car, travel and phone need a sensible disallowance. Keep a fixed-asset register from day one — it is the depreciation claim’s backbone. Our filing practice runs the 44ADA-versus-books computation both ways before choosing.