Lump-sum deductions

A lump-sum deduction refers to a predetermined amount that taxpayers can deduct from their income when computing taxable income, without the requirement to document actual expenses. This approach simplifies compliance, as all eligible taxpayers receive the same deduction even if their personal expenses differ.

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For example, salaried individuals in India are entitled to a standard deduction of ₹50,000 from their salary income, independent of their work-related spending. Likewise, under presumptive taxation rules for specified professionals, half of their gross receipts is treated as allowable expenses, and they are not required to maintain detailed expense records.