Turnover limit regarding Proprietorships and coverage in limit of 60 Audits
This query is : Resolved
06 April 2026
1.
Whether a proprietorship concern having turnover in the range of ₹1 crore to ₹2 crore, and subject to tax audit under Section 44AB, would be included within the overall ceiling of 60 tax audit assignments that may be undertaken/signed by a Chartered Accountant, as prescribed by the Institute of Chartered Accountants of India (ICAI).
2.
In the case of a proprietorship concern with turnover of ₹1.5 crore, where the entire receipts are in cash, whether the assessee can opt for presumptive taxation under Section 44AD by declaring income at 8% (i.e., ₹12 lakh), and consequently claim that no tax liability arises on the basis that income up to ₹12 lakh is not taxable for the relevant financial year.
3.
In the case of a proprietorship concern having turnover of ₹1.9 crore, whether it is permissible to declare income at 6% (i.e., ₹11.40 lakh) under Section 44AD, and similarly contend that no tax liability would arise on the assumption that income up to ₹12 lakh is exempt from tax.
Whether a proprietorship concern having turnover in the range of ₹1 crore to ₹2 crore, and subject to tax audit under Section 44AB, would be included within the overall ceiling of 60 tax audit assignments that may be undertaken/signed by a Chartered Accountant, as prescribed by the Institute of Chartered Accountants of India (ICAI).
2.
In the case of a proprietorship concern with turnover of ₹1.5 crore, where the entire receipts are in cash, whether the assessee can opt for presumptive taxation under Section 44AD by declaring income at 8% (i.e., ₹12 lakh), and consequently claim that no tax liability arises on the basis that income up to ₹12 lakh is not taxable for the relevant financial year.
3.
In the case of a proprietorship concern having turnover of ₹1.9 crore, whether it is permissible to declare income at 6% (i.e., ₹11.40 lakh) under Section 44AD, and similarly contend that no tax liability would arise on the assumption that income up to ₹12 lakh is exempt from tax.
06 April 2026
• ✔ Proprietorship audits under 44AB ARE included in 60 audit limit
• ✔ 44AD can be opted for turnover up to ₹2 crore
• ❌ Income up to ₹12 lakh is NOT automatically tax-free
• ✔ Cash cases → 8% mandatory
• ✔ Digital cases → 6% allowed
• ❌ Lower declaration → triggers tax audit
• ✔ 44AD can be opted for turnover up to ₹2 crore
• ❌ Income up to ₹12 lakh is NOT automatically tax-free
• ✔ Cash cases → 8% mandatory
• ✔ Digital cases → 6% allowed
• ❌ Lower declaration → triggers tax audit
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