What is the manner of computation of taxable business income under the normal provisions of the Income-tax Law, i.e., in case of a person not adopting the presumptive taxation scheme of section 44AD?
Generally, as per the Income-tax Law, the taxable business income of every person is computed as follows :
Turnover or gross receipts from the business
Less : Expenses incurred in relation to earning of the income
Taxable Business Income
For the purpose of computing taxable business income in the above manner, the taxpayers have to maintain books of account of the business and income will be computed on the basis of the information revealed in the books of account.
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