Section 44AE Limit Changed for Large Motor Vehicles

This section is used to calculate deduction in case of those in Goods Transport Business

As per this section,if a person has upto 10 trucks,there is no need to maintain books of accounts

Flat 7500 per month will be treated as Business Income for each truck

The limit was same for Heavy goods vehicle(large truck) and light good vehicle(small truck)

Now in FY 2018-19(Assessment Year 2019-20)

Limit increased for Heavy goods vehicle

It will be Rs 1000/tonne of Gross vehicle weight or unladen weight per month

However for light motor vehicles,rates are same as 7500 pm

Summary

Example

Suppose a person has 2 trucks

One is Large Truck (Gross Vehicle Weight 25000 kg) 

Second is Small Trucks (Gross Vehicle Weight 7000 kg)

Both trucks are used through out the year

Calculate PGBP Income in FY 2017-18 AND FY 2018-19

Answer

In Financial Year 2017-18 (AY 2018-19)

Weight of Truck is not relevant

Profit of both trucks will be calculated @ 7500 per truck per month

In Financial Year 2018-19 (AY 2019-20)

Weight of Truck is not relevant for Small Truck

But for Large truck,we will consider weight in tonnes

Weight in tonnes of Large Truck=25000/1000=25 tonnes

How to Find Whether Truck is Small Truck or Large Truck

IF weight of truck upto 12000 Kg

Small Truck

IF weight of truck more than 12000 Kg

Large Truck