Income Tax for Doctors in India — 44ADA, TDS & ITR

For AY 2026-27 the presumptive limit for professionals is Rs75 lakh, up from Rs50 lakh, but the higher figure applies only if cash receipts are within 5% of total receipts (i.e. most collections are digital/bank). If cash receipts exceed 5%, the limit stays at Rs50 lakh. Above the applicable limit, 44ADA cannot be used and books must be maintained.

Yes. Section 44ADA applies to the medical profession as a whole, including cardiologists, neurosurgeons, dentists and every specialist. There is no exclusion by specialisation. The only conditions are that the taxpayer is a resident individual or firm and that gross professional receipts are within the presumptive limit.

No. Under Section 44ADA the 50% deemed income is treated as already accounting for all expenses, including depreciation on medical equipment. You cannot separately deduct depreciation, rent, salaries or consumables. To claim actual depreciation on CT scanners, MRI machines or instruments, you must opt out of 44ADA and maintain books of account.

A doctor with only presumptive professional income under 44ADA files ITR-4. A doctor with salary plus 44ADA consulting income can also use ITR-4, provided total income is up to Rs50 lakh. ITR-3 applies when you maintain books instead of using 44ADA, when total income exceeds Rs50 lakh, or when you have capital gains beyond the small listed-equity allowance. A purely salaried doctor (full-time hospital employee with no consulting) files ITR-1 or ITR-2.

A full-time hospital employee is taxed under Salaries — the hospital deducts TDS under Section 192 and the doctor files ITR-1 or ITR-2. A doctor running a clinic or consulting independently is taxed under PGBP and can opt for 44ADA if receipts are up to Rs75 lakh. Many doctors have both salary and consulting fees, so both heads apply — ITR-4 if the consulting income is under 44ADA and total income is up to Rs50 lakh, otherwise ITR-3.

Yes. Salary from a hospital is taxed under the head Salaries with a standard deduction (Rs75,000 in the new regime, Rs50,000 in the old). Consulting and visiting fees are professional income taxed under PGBP, where you can use 44ADA or claim actual expenses. When both exist, they are added together and taxed at the applicable slab.

Hospitals deduct TDS at 10% under Section 194J on professional or consulting fees paid to doctors. This TDS shows in your Form 26AS and AIS and is credited against your final tax liability. If your actual tax is lower — for example under 44ADA — the excess TDS is refunded when you file your return.

If your tax after TDS exceeds Rs10,000 you must pay advance tax. Ordinary taxpayers pay in four instalments (15 June, 15 September, 15 December, 15 March). Doctors filing under 44ADA get a simplified rule — the entire advance tax is paid in one instalment by 15 March. Missing advance tax attracts interest under Sections 234B and 234C.

For AY 2026-27 the new regime is the default and suits most doctors: tax is nil up to Rs12 lakh taxable income due to the Section 87A rebate, with a Rs75,000 standard deduction on salary. The old regime is worth choosing only if you have large 80C, 80D, home-loan or HRA deductions that exceed the new regime's benefit. Model both before filing.

Under the new regime for AY 2026-27, a resident individual pays nil tax up to Rs12 lakh of taxable income because of the enhanced Section 87A rebate. A salaried doctor, after the Rs75,000 standard deduction, effectively pays nil up to about Rs12.75 lakh of gross salary. Professional income under 44ADA does not get the standard deduction, so the nil point is Rs12 lakh of deemed income.

Under the default new regime: nil up to Rs4L; 5% on Rs4-8L; 10% on Rs8-12L; 15% on Rs12-16L; 20% on Rs16-20L; 25% on Rs20-24L; and 30% above Rs24L, plus 4% cess. The 87A rebate makes tax nil up to Rs12 lakh taxable income. The old regime, if chosen, uses the 2.5L/5L/10L structure with full Chapter VI-A deductions.

Generally no. Medical consultation and treatment provided by doctors and clinical establishments are exempt from GST, so a purely practising doctor does not register or charge GST regardless of turnover. Registration may be needed only for taxable non-medical income — such as renting out equipment or running a diagnostic lab as a business — where that turnover crosses Rs20 lakh.

Yes. Cosmetic or plastic surgery that is not to treat an illness, injury or deformity attracts 18% GST — for example, purely aesthetic rhinoplasty or breast augmentation. Reconstructive surgery after an accident or cancer, and any surgery to treat a medical condition, remains GST-exempt as healthcare.

A doctor maintaining books (not under 44ADA) can deduct clinic rent, staff salaries, medical consumables, equipment depreciation at 15% WDV, NMC/council registration fees, CME and conference costs, and professional subscriptions. Under 44ADA none of these are claimed separately because the 50% deemed profit already accounts for all expenses.

The Income-tax Act, 2025 replaces the 1961 Act from AY 2026-27 and renumbers sections, but the substance for doctors is unchanged — presumptive taxation for professionals (44ADA), 10% TDS on professional fees (194J), the slab structure and the healthcare GST exemption all continue. Always confirm the current section numbering on incometax.gov.in.