Income Tax Guide · AY 2026-27

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

How doctors are taxed in FY 2025-26 — Section 44ADA presumptive scheme, TDS under 194J, ITR-3 vs ITR-4, the new vs old regime choice, deductions and GST exemption on healthcare.

Updated for AY 2026-27 CA Reviewed Clinic, Consultant & Salaried

File Doctor ITR with a CA See the 44ADA rule

50%Deemed income (44ADA)

Rs75LPresumptive cap

10%TDS under 194J

Rs12LNew-regime nil-tax point

Quick Answer

A doctor's professional income (clinic, consulting, visiting fees) is taxed under Profits & Gains of Business or Profession (PGBP). If gross receipts are up to Rs75 lakh, you can opt for Section 44ADA and declare just 50% of receipts as income with no books and no audit (file ITR-4). Hospitals deduct 10% TDS under Section 194J on fees. Salary from a hospital is taxed under "Salaries". Medical consultation and treatment are exempt from GST.

Presumptive (44ADA) 50%

Receipts cap Rs75L

TDS on fees 10%

Healthcare GST Exempt

At a glance

How a Doctor's Income Is Taxed

Doctors often earn from several sources at once. Each income type has its own tax head, TDS section and ITR form — this decides whether you file ITR-3 or ITR-4.

Income Type	Tax Head	TDS	ITR Form
Salary from hospital (full-time)	Salaries	Sec 192	ITR-1 / ITR-2
Consulting / visiting fees	PGBP (profession)	194J · 10%	ITR-3 / ITR-4
Own clinic / private practice	PGBP (profession)	None	ITR-3 / ITR-4
Teaching / visiting faculty	PGBP or Other Sources	194J · 10%	ITR-3 / ITR-4
Medico-legal / report fees	PGBP (profession)	194J · 10%	ITR-3 / ITR-4

A doctor with both salary and professional receipts uses ITR-3 (ITR-4 is only for purely presumptive income). Rates reflect AY 2026-27.

Receipts above Rs75 lakh? 44ADA is out

If gross professional receipts exceed Rs75 lakh, Section 44ADA cannot be used. You must maintain books of account and, where turnover/receipt limits are crossed, get a tax audit under Section 44AB. ITR-3 then applies, but you can claim actual expenses — depreciation, staff salary, rent and consumables.

The core benefit

Section 44ADA — Presumptive Tax for Doctors

The Section 44ADA presumptive scheme is the simplest route for self-employed doctors. You treat 50% of gross receipts as taxable income and the other 50% is deemed to cover all expenses — no books, no audit.

Gross receiptsUp to Rs75 lakh a year

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Deem 50%Taken as net professional income

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Add other incomeSalary, interest, capital gains

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File ITR-4Pay advance tax by 15 March

Who qualifies: resident individual or firm in the medical profession (MBBS, BDS, AYUSH, specialists) with receipts up to Rs75 lakh.
Rs75 lakh cap: the higher Rs75L limit (up from Rs50L) applies only if cash receipts are within 5% of total receipts; otherwise the limit is Rs50 lakh.
No depreciation separately: the 50% deemed profit already absorbs all expenses, including equipment depreciation.
Advance tax: pay 100% in a single instalment by 15 March — quarterly instalments do not apply under 44ADA.

Doctor on 44ADA · Rs40L receipts

Gross receiptsRs40,00,000

Deemed income @ 50%Rs20,00,000

Standard deductionN/A (profession)

Taxable incomeRs20,00,000

Salaried doctor · Rs20L CTC (new regime)

Gross salaryRs20,00,000

Standard deductionRs75,000

Taxable salaryRs19,25,000

Tax slab appliesNew regime

Not sure whether 44ADA or actual-expense filing saves you more?

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Post Budget 2025

New vs Old Regime — Which Should a Doctor Pick?

For AY 2026-27 the new regime is the default. A resident individual pays nil tax up to Rs12 lakh taxable income (Section 87A rebate); with the Rs75,000 standard deduction, a salaried doctor pays nil up to about Rs12.75 lakh. The old regime is optional and only worth it if your 80C/80D/home-loan deductions are large.

Taxable Income (New Regime)	Tax Rate
Up to Rs4,00,000	Nil
Rs4,00,001 – Rs8,00,000	5%
Rs8,00,001 – Rs12,00,000	10%
Rs12,00,001 – Rs16,00,000	15%
Rs16,00,001 – Rs20,00,000	20%
Rs20,00,001 – Rs24,00,000	25%
Above Rs24,00,000	30%

New-regime slabs for AY 2026-27. 87A rebate makes tax nil up to Rs12L taxable income. Cess 4% extra; surcharge capped at 25% under the new regime.

New

New regime (default) — lower slabs, few deductions

Nil tax up to Rs12L taxable income (87A)
Rs75,000 standard deduction on salary
No 80C / 80D / HRA / home-loan set-off
Best for most consultant & 44ADA doctors
Surcharge capped at 25%

Old

Old regime (optional) — higher slabs, full deductions

87A rebate only up to Rs5L income
Rs50,000 standard deduction on salary
Full 80C, 80D, home-loan & HRA claims
Senior 60-80: Rs3L exemption; 80+: Rs5L
Worth it only with large deductions

Compare both regimes on your exact numbers before you file.

Old vs New Regime Calculator →

When you keep books

Deductions for Doctors (Receipts Above Rs75L or Old Regime)

A doctor who maintains books — because receipts cross Rs75 lakh, or who prefers the old regime with actual expenses — can deduct the real cost of running the practice:

Deduction	Basis	Notes
Clinic / chamber rent	Actual rent	Agreement needed; TDS if rent > Rs2.4L/yr
Equipment depreciation	15% WDV	CT/MRI, ultrasound, surgical instruments
Staff salaries	Actual	Receptionist, nurse, compounder
NMC / council fees	Actual	Annual registration & renewal
CME / conferences	Actual	Continuing medical education for practice
Consumables	Actual	Gloves, syringes, dispensed medicines

Depreciation is 15% on written-down value (half rate if the asset is used under 180 days). Not available separately under 44ADA.

Indirect tax

GST & Compliance for Doctors

Healthcare services by a doctor or clinical establishment — consultation, diagnosis, treatment and surgery — are exempt from GST. Purely healthcare-earning doctors need not register for GST at any turnover.

GST-exempt (no registration)

Consultation, diagnosis & treatment
Surgery to treat illness, injury or deformity
Reconstructive surgery (post-accident, post-cancer)
Services from a registered clinical establishment

Taxable / may need registration

Purely cosmetic or aesthetic surgery — 18% GST
Renting out equipment or premises as a business
Running a diagnostic lab on a business footing
Non-medical income crossing Rs20 lakh

Choose 44ADA vs books early
Pick new vs old regime
Reconcile 194J TDS in Form 26AS / AIS
Pay advance tax (15 March if 44ADA)
File ITR-3 or ITR-4 by due date
Keep receipts & fee records
Depreciation schedule (if books)
Report all hospital & clinic income

TaxClue Insight

Most doctors on 44ADA are better off in the new regime — the 50% deemed profit already replaces expense deductions, so the extra 80C/80D relief of the old regime rarely beats the new regime's nil-tax-to-Rs12L benefit. Model both before you file.

Government sourcesSlabs, 44ADA & forms: incometax.gov.in · Presumptive profession: Section 44ADA, Income-tax Act (renumbered under the Income-tax Act, 2025, AY 2026-27) · TDS on professional fees: Section 194J (10%) · Healthcare GST exemption: Notification 12/2017-Central Tax (Rate)

Frequently Asked Questions

Section 44ADA & Presumptive

Can doctors use Section 44ADA presumptive taxation?

Yes. Section 44ADA covers the medical profession, so any doctor — general practitioner, super-specialist, dentist or consultant — can opt for it as long as gross professional receipts do not exceed Rs75 lakh in the year. You declare 50% of receipts as income, keep no books and need no tax audit. The specialisation does not matter; what matters is that the income is from a medical profession.

What is the Rs75 lakh limit for 44ADA?

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.

Do super-specialist doctors qualify for 44ADA?

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.

Can I claim depreciation under 44ADA?

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.

ITR Form & Filing

Which ITR form should a doctor file?

A doctor with only presumptive professional income under 44ADA files ITR-4. A doctor with both salary and professional receipts, or who maintains books, files ITR-3. A doctor who is purely salaried (full-time hospital employee with no consulting) files ITR-1 or ITR-2. Because most practising doctors have mixed income, ITR-3 is very common.

How is a hospital-employed doctor taxed vs one running a clinic?

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 and ITR-3 is used.

Is salary and consulting income taxed differently for doctors?

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.

TDS & Advance Tax

How much TDS do hospitals deduct on doctor fees?

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.

What is the advance tax rule for doctors?

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.

Regime & Slabs

Should doctors choose the new or old tax regime?

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.

How much income is tax-free for a doctor in 2025-26?

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.

What are the income tax slabs for doctors in AY 2026-27?

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.

GST & Others

Do doctors need GST registration?

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.

Is cosmetic surgery taxable under GST?

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.

What expenses can a doctor claim as tax deductions?

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.

Has the Income-tax Act, 2025 changed how doctors are taxed?

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.

Done-for-you

Related TaxClue Services

Income Tax Return FilingCA-led ITR-3/ITR-4 for doctors, with 44ADA and TDS reconciliation.Explore →Section 44ADA FilingPresumptive filing done right for clinics and consultants.Explore →Advance Tax PaymentCompute and pay advance tax on time to avoid 234B/234C interest.Explore →TDS on Professional FeesReconcile 194J TDS deducted by hospitals against your tax.Explore →

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