New Enroll in RBI Grade B New Batch - Starts on May 21

    Question

    Considering the challenges faced by MSMEs in maintaining

    consistent financial reporting standards, which of the following changes in the Income Tax Act of 1961 specifically targeted the simplification of tax compliance for MSMEs with annual turnover of less than _______ under Section ________.
    A ₹3 crore under section 44AD. Correct Answer Incorrect Answer
    B ₹2 crore under section 44AD. Correct Answer Incorrect Answer
    C ₹75 lakhs under section 44DA. Correct Answer Incorrect Answer
    D ₹2 crore under section 44DA. Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Section 44AD of the Income Tax Act allows MSMEs with a turnover of up to ₹2 (amended to 3 crores subject to minimum criteria of digital transactions (only 5% in cash receipts allowed) in budget 2023). crore to opt for a presumptive taxation scheme. The Budget 2023 amended Sec 44AD and Sec 44ADA and revised presumptive taxation limits for FY 2023-24 (AY 2024-25) as follows:   *The increase in limits is subject to a condition that 95% of the receipts must be through online modes.

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