Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
The Section 44AA rule
Section 44AA governs who must keep books. For the specified professions (medical, legal, engineering, etc.), prescribed books must be maintained if gross receipts exceed ₹1,50,000 in any of the three preceding years (or are likely to, for a new practice). For other professions/businesses, the test is income/turnover-based.
The presumptive interaction
If you use 44ADA and declare 50%+, you’re relieved from these book-keeping requirements. But if you opt out and declare lower profit, the full Section 44AA obligation revives. So presumptive taxation is the main route by which small professionals avoid detailed books. Confirm the current thresholds.
A worked example
Example: a new physiotherapist expecting ₹8 lakh receipts must maintain the prescribed books under 44AA — unless she opts for 44ADA at 50%, which relieves her. A tiny part-time consultant under ₹1.5 lakh receipts needs only basic records. The presumptive scheme is usually the simplest path. Our team can advise what records you must keep.