Applicability of Tax Audit
This query is : Resolved
21 September 2009
Hi. I wanted to know the applicability of Tax Audit for an client who has received advance amounting Rs 1 Cr, but having his gross turnover less than 40 lakh. The client is engaged in the project activity.
21 September 2009
gross revenue receipts if at 1 crore , 44Ab attracted , audit applicable.
Capital receipts if at 1 crore , audit not applicable,
Although the guidance note on tax audit clearly states that advance received is liability until services are rendered , hence they dont form a part of gross receipts , but still there are issues left .
It has been held in some cases , that advances include an element of profit , hence it's covered in gross receipts
Guidance note of the ICAI for turnover of contractors replacing ASI 29 is a big help.
Although i believe the provisions are still open to intepretation , even after 25 years.
Capital receipts if at 1 crore , audit not applicable,
Although the guidance note on tax audit clearly states that advance received is liability until services are rendered , hence they dont form a part of gross receipts , but still there are issues left .
It has been held in some cases , that advances include an element of profit , hence it's covered in gross receipts
Guidance note of the ICAI for turnover of contractors replacing ASI 29 is a big help.
Although i believe the provisions are still open to intepretation , even after 25 years.
21 September 2009
no tax audit is not applicable
21 September 2009
Advance can be refunded if you do not carry on the project or disassociate yourself from the project. Advance is not considered for Section 44AB. I agree with expert Jitendra in the present context.
21 September 2009
Tax audit is not applicable
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- GSTR-1A How to update Invoice
- Excess salary payment.
- Capital gain from sale of house property
- Stamp Paper for partnership firm change new income tax 2025
- TDS on Purchase of Immovable Property by NRI from NRI
- INTEREST APPLICABLE ON ITC REVERSAL PORTION
- Current Account Opening for Sole Proprietorship with Udyam Certificate - Zero Turnover
- Regarding TDS Applicability For Director Remuneration
- Annual return in Gst
- Value of property in capital gain
- TDS APPLICABILITY......
- Copyright software
- Cash gift by grand mother to her grand daughter
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
- No Compliences after incorporation
- USEFUL LIFE OF USED/SECOND HAND COMMERCIAL VEHICLES
- Claiming TDS deducted by builder on Hardship compensation and Corpus
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
