31 July 2017
sir, please give me answer for the following problem:- a firm has loss during the P.Y and their turnover for the period is 5,00,000/-.whether tax audit is applicable for them by invoking provision under section 44AB that " the person is carrying on B/P and is covered under the provisions of section 44AD,44ADA,44AE,44AF,44BB,44BBB and claims that his income from the said business is lower than the deemed profits and gains computed under the relevat section"
my assumption:- sec 44AD is not a compulsory sec and it is just an option to the tax payer.so the person covered under 44AD portion of the said provision is applicable for those who are opting the presumptive scheme earlier. am i right?????? if a person who not opt for presumptive scheme earlier, then he is not required for 44AB in this case.am i right? pls clarify the same
31 July 2017
your contention as to applicability of presumptive sections is at the option/choice of assessee is right. But the same logic does NOT hold good for Tax Audit. Please read section 44AD or 44ADA where it is said...if the % of profit is below the thresh hold.....tax audit is mandatory Your views please
31 July 2017
then what is the relevance of 'person covered under sec 44AD' ? still some confusion. ok as per ur contention every assessee must compute their tax under presumptive basis and normal basis and should compare both ,then only we have to determine whether he is liable for 44AB or not (provided if his income does not exceed 1cr)?
31 July 2017
no, that is NOT the contention. If assessee's business is running at a profit which is less than the % as given in the presumptive sections, then TAX AUDIT should be conducted. That is all...... You can very well run your business at a lesser profit than what is envisaged in the presumptive sections. You need to carry out the tax audit. That is it.
01 August 2017
Actually so far as LOSS is concerned, there are 2 views among tax experts /CAs etc. 01.. Tax audit is required for any profit less than 8 or 6 %, as the case may be 02. Tax audit is required only for those cases showing lower income. For loss you dont have to do tax audit.
01 August 2017
Sir.,
I have one more doubt...
If a partnership firm have turn over 50 Lakhs. If they ll take Remuneration and Interest after calculate 8%.... Then how to deal the account...?
They tax audit or not...?
07 August 2017
dear sir, sec 44AD(4) and sec 44AD(5) clearly states that presumptive is applicable only for those people who already opt for presumtive scheme earlier.pls check the following provision.
Section 44 AD(4):- Where an eligible assessee declares profit for any assessment year in accordance with the provisions of this section and he declares profit for any of the five consecutive subsequent assessment years at lower than the required 8 percent, then he shall not be eligible to claim the benefit of the provisions of this section for five assessment years subsequent to the assessment year relevant to the previous year in which the profit has not been declared up to 8 percent. Section 44 AD(5):- Consequently, such assessee, if total income exceeds maximum amount not chargeable to tax, shall be required to keep and maintain books of accounts and other documents as per section 44AA and get them audited and furnish a report of such audit as required under section 44AB
07 August 2017
yes. Assessment Year 2016 17 you can deduct remuneration etc.from 8% For Assessment year 2017 18, 8% is after assuming deduction of remuneration
CAclubindia
