ITR Audit
Underneath Section 44AB Income-tax Act: Income-tax Audit
Tax Audit is compulsory under section 44AB of the Income Tax Act, 1961. Every Person carrying on business or Profession whose Gross receipts exceeds Rs. 5 crores (some conditions are attached) has to get his accounts Audited by Chartered Accountants obligatorily.
Who is mandatorily subject to the Tax Audit?
Section 44AB of Income Tax Act, 1961 states that certain persons are carrying on the business or profession, have to get their books of accounts audited by a practising Chartered Accountant (CA).
Business
In case of any business, if the total amount of sales, turnover or the gross receipts exceed(s) Rs. 1 crore in any previous year.
Provided that if the aggregate of all receipts & payments in cash during the previous year does not exceed 5% of such receipts & payments. The limit of "Rs. 1 crore" will be substituted by "Rs.5 crore". The revised limits of 5 crore are applicable from Assessment Year 2021-22.
How Can Tax Audit Be Beneficial for Your Organization?
Apart from the fact that tax audit will save your business from legal compliances and penalties. It also has various benefits that can drive your organization upwards & serve your business in diversified ways, such as:
- Government authorities accept audited statements as true & fair for the purpose of taxation. It will help you in getting loans and licences for your organization.
- Adds reliability to your organization for customers, suppliers, investors, employees & tax authorities. It raises the trustworthiness of the organization.
- It will reduce the chances of fraudulent activities in your organization.
- We, Manish Anil Gupta & co, will give you concrete suggestions regarding improvements of business based on findings in your records.
Required Documents for ITR Audit
- Aadhar Card
- PAN Card
- Mobil Phone Number
- Email ID
- Bank Statements For Particular Financial Year
- Digital Signature Certificate ( if Required )
- OTHERS ( As case may be )
ITR Audit FAQ
Tax audit report is an examination of an individual's or organization’s tax returns by any outside agency to verify that all the income, expenditure and deduction information are filed correctly. The audit report is given as per format available in the form numbers 3CA/3CB and 3CD.
Sec 44AB gives the provisions relating to the class of taxpayers who are required to get their accounts audited by a chartered accountant. The audit under section 44AB aims to ascertain the compliance of various provisions of the Income-tax Law and the fulfillment of other requirements of the Income-tax Law.
- Tax audits are conducted to facilitate the administration of tax laws by presenting the accounts properly in front of authorities.
- Proper maintenance of the book of accounts
- To get a proper record about the income of the taxpayers as well as their tax deductions.
- Tax audits is saving verification time. Tax Audits help save time that is taken during routine verification, which is an even more tedious procedure than auditing.
3CA-3CD: Tax Audit Report in the case of a taxpayer having business or profession income who is mandatorily required to get accounts audited under any other Act (other than Income Tax Act) For example : companies 3CB-3CD Tax Audit Report in the case of a taxpayer having business or profession income who is not required to get accounts audited under any other Act (other than Income Tax Act) For example: other than companies
Assessing Officer may impose penalty u/s 271B if the taxpayer doesn’t get his accounts audited or file the audit report.
The least of following may be levied as a penalty:-
But you don't need to bother about penalties. Because we, AGA & ASSOCIATES are here to care for your business with the timely compliances.