44ADA is now section 58: presumptive tax from 2026-27

From Beside the Job, chapter 5Look inside Beside the Job

What changed on 1 April 2026?

The Income-tax Act, 2025 came into force on 1 April 2026 (source 1, section 1(3)). The Income Tax Department’s FAQs say the 1961 Act stands repealed from that date, that its provisions still govern tax years beginning before it, and that “tax year” replaces both “previous year” and “assessment year” (source 2). So an article that says “44ADA” is describing the old Act.

Which row is yours?

Row 3: a profession (the old 44ADA)

Who: a resident individual or firm (not an LLP) in a specified profession.
Limit: gross receipts up to ₹50 lakh, or ₹75 lakh if cash receipts are 5% or less.
Profit counted: 50% of gross receipts, or more if you earned more.

Row 1: a business (the old 44AD)

Who: a resident individual, HUF or firm (not an LLP) that doesn’t carry on a specified profession, earn commission or brokerage, or run an agency business, and claims no deduction under Chapter VIII-C for the year.
Limit: turnover up to ₹2 crore, or ₹3 crore if cash receipts are 5% or less.
Profit counted: 6% of receipts by bank or online modes, 8% of the rest, or more if you earned more.

From section 58(2) and (11), as amended by the Finance Act, 2026 (source 1, source 3). Row 2 is for goods carriages. Under row 1, the 6% covers receipts by “specified banking or online mode” up to the return’s due date.

Is your work a specified profession?

Section 62(4) lists them: “legal, medical, engineering, architectural, accountancy, technical consultancy, interior decoration, information technology or company secretary”, and any other profession the Board notifies (source 1). Information technology is in the Act’s own list.

Designers, writers and marketers aren’t named. Whether your work falls inside a named profession, row 1, or neither, is the first question for your CA. Note that row 1 is closed to anyone who carries on a specified profession (section 58(11)(a)).

What does 50% mean in rupees?

An invented example, as arithmetic only: on receipts of ₹18,00,000 in a tax year, all received by bank transfer, row 3 counts at least ₹9,00,000 as profit (50%), and row 1, for someone it fits, at least ₹1,08,000 (6%). It isn’t a computation of anyone’s tax.

What comes with section 58?

Declaring less than the row’s figure while your total income is above the amount not chargeable to tax means keeping books and having them audited (section 58(3)).
No other deductions or losses are set against the income the row works out (section 58(4)).
Leaving row 1 in any of the five tax years after you used it shuts you out of section 58 for the five tax years that follow, and may mean books and an audit (section 58(7) and (8)).
Books for professionals. Section 62(1)(a) asks anyone carrying on a specified profession to keep books of account as the Board prescribes. Ask your CA what that means for you.
Advance tax in one go, by 15 March, if you declare under row 1 or row 3 (section 408(2)). The advance tax guide has the dates.
The return, if your accounts need no audit, is due on 31 August after the tax year: 31 August 2027 for tax year 2026-27 (source 3, section 66, substituting section 263(1)(c)).

What if you also have a salary?

Section 58 deals with the business or profession only. Tax deducted from your salary counts when you work out whether advance tax is due (section 405). The side-business guide covers what to read in your own contract first.

From the kit. Beside the Job, chapter 5, sets the old names beside the new sections, with a set-aside calculator in the workbook. The Export Desk’s chapter 10 covers section 58 for freelancers who bill clients abroad. This is Beside the Job’s page.

Free: the weekly card from Beside the Job, and the export invoice check.

Questions to ask your CA

Is my work a specified profession under section 62(4), and so row 3?
If not, does row 1 fit, or should I keep full books?
Which books does the Board prescribe for my profession?
Should I pay advance tax by 15 March 2027, or in four instalments?
Which return form do I file for tax year 2026-27, and by when?

Sources

Ministry of Law and Justice. The Income-tax Act, 2025 (No. 30 of 2025), the Gazette of India, 21 August 2025. Sections 1(3), 58, 62(1) and (4), 405 and 408(2). Primary source. Read on 1 November 2026.
Income Tax Department. Objective and scope of the New Act, the e-filing portal’s FAQs: the repeal of the 1961 Act on 1 April 2026, the tax year, and section 58 consolidating 44AD, 44ADA and 44AE. Primary source. Read on 1 November 2026.
Ministry of Law and Justice. The Finance Act, 2026 (No. 4 of 2026), the Gazette of India, 30 March 2026. Section 40 (section 58(11)) and section 66 (section 263(1)(c)). Primary source. Read on 1 November 2026.

What changed in this guide

1 November 2026. Sources read again before publishing.
20 October 2026. Written, and checked against the sources above.