Tax audit for fy 10-11

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This query is : Resolved

Harshad (Querist)

06 August 2011 My turnover of business is Rs. 58,00,000/- net of VAT for FY 10-11 and VAT on above is Rs. 2,32,000/- @ 4% . M i liable for tax audit U/s 44AB of Income Tax Act 1960?

CA Ashwani Agarwal

CA Ashwani Agarwal (Expert)

06 August 2011 No, he is not liable for Audit u/s 44AB.

But please consider 44AD also, show NP more than 8%, i.e. 464000 or more, otherwise you will have to get it audited.

Harshad

Harshad (Querist)

06 August 2011 Sir, plz explain in detail why i am not liable to audit? And my profit is Rs. 5,56,800/- i.e 9.6%

CA Ashwani Agarwal

CA Ashwani Agarwal (Expert)

06 August 2011 You are not liable to audit as your Turnover is less than 60 lakhs because turnover is exclusive of VAT.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

06 August 2011 Turn over is not defined for the purpose of section 44AB. Therefore, the method of accounting regulrly employed, in the instant case, is the deciding factor. Accordingly, if VAT Collected is separately accounted and VAT payment is also debited in that account, then turnover for the purpose of section 44AB is Rs. 58/- lakhs only. This is as per ICAI guidelines. In view of that and the NP is more than 8% audit under section 44AB does not apply.

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