ITR Section 44AD & 44AB

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This query is : Resolved

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This discussion clarifies the eligibility for Income Tax Return (ITR) filing under Section 44AD and the mandatory audit requirements under Section 44AB. It explains that once a taxpayer opts out of Section 44AD, they may need to undergo a tax audit under Section 44AB for five consecutive years if their total income exceeds the basic exemption limit. This is crucial for individuals with turnovers exceeding Rs 45 lakhs and profits below 8%.

Sanjeet

Sanjeet (Querist)
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15 August 2022 Dear Sir,

Financial Year 2019-20 We have filed ITR under section 44AD declare profit 8%. In Financial year 2020-21 Turnover is Rs.45 Lacs and profit is 4.6% Filed the ITR after audit under section 44AB. Financial year 2021-22 Turnover is Rs.73 Lacs Profit is 8.34% Can we go for 44AD or need to audit please suggest.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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15 August 2022 Not eligible for sec. 44AD of the act now. Need to audit u/s. 44AB(e) of IT act for continuous 5 years after opting out of sec. 44AD, provided the total income exceeds the basic exemption limit.

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Sanjeet

Sanjeet (Querist)
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15 August 2022 Thank you very much Sir,

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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15 August 2022 You are welcome..

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