Income Tax for Doctors in India

Updated: 3 June 2026

Quick Answer: Self-employed doctors with gross receipts up to ₹75 lakh can use Section 44ADA — pay tax on just 50% of gross receipts with no books or audit required. Hospitals deduct TDS at 10% (Section 194J) on consultation/professional fees above ₹30,000/year. Healthcare services are GST-exempt.

50%

Under Section 44ADA, only 50% of a doctor's gross receipts is treated as taxable income — the rest is automatically deemed as expenses. No separate expense bills needed if you're within the ₹75 lakh limit.

Section 44ADA — Presumptive Taxation for Doctors

Section 44ADA of the Income Tax Act applies to professionals listed under Section 44AA(1) — which explicitly includes medical professionals (doctors, surgeons, dentists, etc.). Under this scheme:

Gross receipts limit: ₹75 lakh per financial year (raised from ₹50 lakh from FY 2023-24 onwards)
Deemed profit: 50% of gross receipts is considered net income; no need to prove actual expenses
No books of accounts required under this scheme
No tax audit required (unlike regular profession where audit is needed above ₹50 lakh)
Can declare higher income than 50% if desired (but never lower, unless opting out)
Advance tax: only one installment due by March 15 (unlike salaried employees who pay in four installments)

If a doctor opts out of Section 44ADA (or gross receipts exceed ₹75 lakh), regular books of accounts must be maintained and a tax audit under Section 44AB becomes mandatory.

Tax Treatment by Income Type for Doctors

Income Type	ITR Form	Section	TDS	Audit Required?
Private clinic / consultation fees (self-employed)	ITR-4 (44ADA) or ITR-3	44ADA / 28	194J @ 10% by payer	No (if 44ADA & ≤₹75L)
Salary from hospital / corporate employer	ITR-1 or ITR-2	Section 192	TDS at slab rates	No
Surgery / procedure fees from hospitals	ITR-4 or ITR-3	44ADA / 28	194J @ 10%	No (if 44ADA & ≤₹75L)
Teaching / lecture / CME income	ITR-4 or ITR-3	44ADA / 28	194J @ 10%	No (if 44ADA & ≤₹75L)
Gross receipts > ₹75 lakh (any professional income)	ITR-3	Section 28	194J @ 10%	Yes — Section 44AB

GST for Doctors — Healthcare Exempt, Cosmetic Taxed

Healthcare services provided by an authorised medical practitioner are fully exempt from GST under Entry 74 of Notification 12/2017-Central Tax (Rate). This means:

OPD consultation, IPD treatment, surgeries, diagnostic services — all GST exempt
No GST registration required for purely medical practice income
GST exemption applies regardless of the doctor's annual turnover from medical services

Exception — Cosmetic Surgery: Procedures that are not medically necessary (purely aesthetic cosmetic surgery) attract 18% GST. If a doctor's cosmetic surgery income exceeds ₹20 lakh in a year, GST registration becomes mandatory.

Old Regime vs New Regime for Doctors

The new tax regime (Section 115BAC) is the default from FY 2023-24, but doctors — particularly self-employed ones — often find the old regime more beneficial if they have significant deductible expenses.

Comparison Point	Old Regime	New Regime (115BAC)
80C (LIC, PPF, ELSS)	Up to ₹1.5 lakh deduction	Not available
80D (health insurance)	Up to ₹25,000–₹50,000	Not available
Clinic rent & staff salary	Deductible (non-44ADA)	Not available
Equipment depreciation	Deductible (non-44ADA)	Not available
44ADA 50% deduction	Available	Available (same)
Tax rates	Slab rates with deductions	Lower slab rates, no deductions

Doctors using 44ADA under the old regime effectively pay tax on 50% of gross receipts and can additionally claim 80C, 80D deductions from that 50%. Under the new regime, only the base 50% deemed income rule applies — no further deductions.

Frequently Asked Questions

Can a doctor use Section 44ADA for presumptive taxation?

Yes. Doctors who are engaged in medical profession and whose gross receipts do not exceed ₹75 lakh in a financial year can opt for Section 44ADA. Under this scheme, 50% of gross receipts is deemed to be net profit. The doctor does not need to maintain books of accounts or get a tax audit done. This is the most popular option for self-employed doctors running private clinics.

Does a hospital deduct TDS on consultation fees paid to a doctor?

Yes. When a hospital, nursing home, or corporate entity pays professional fees (consultation charges, surgery fees, etc.) to a doctor, TDS is deducted under Section 194J at 10% if the total payment in a year exceeds ₹30,000. If the doctor is an employee of the hospital receiving a fixed salary, TDS is deducted under Section 192 based on income tax slab rates — not at 10%.

Does a doctor need to register for GST?

Healthcare services provided by a clinical establishment, an authorised medical practitioner, or a paramedic are fully exempt from GST under Entry 74 of the GST exemption list. Therefore, most doctors providing medical treatment do not need to register for GST for healthcare income, regardless of turnover. However, if a doctor earns income from cosmetic procedures (non-medically necessary), those services attract 18% GST and may trigger GST registration if turnover exceeds the threshold (₹20 lakh for most states).

What deductions can a doctor claim under the old income tax regime?

Under the old regime, doctors maintaining books of accounts can claim: Section 80C (up to ₹1.5 lakh for LIC, PPF, ELSS etc.), Section 80D (health insurance premiums), depreciation on medical equipment and clinic furniture, clinic rent, staff salary, medicine and consumable costs, internet and communication bills, and professional development expenses. These deductions are not available under the new tax regime (Section 115BAC), so doctors with high expenses often find the old regime more beneficial.

Which ITR form should a doctor file?

A self-employed doctor with professional income should file ITR-4 (Sugam) if opting for Section 44ADA presumptive taxation with gross receipts up to ₹75 lakh. If the doctor opts out of 44ADA or receipts exceed ₹75 lakh, ITR-3 must be filed (income from business or profession with regular books). A doctor who is a salaried employee of a hospital files ITR-1 (Sahaj) if there is no other income, or ITR-2 if capital gains are also present.

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