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Audit applicability 44ab

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Karan Prajapati

170 Points Posted on 13 June 2021

1. Business T/o is 1.5Cr I'm showing profit of 4L, whether Audit applicable, if yes, under which section? I've not opted for Presumptive Taxation.

Replies (3)

Quick Summary

This discussion clarifies the applicability of tax audits under Section 44AB of the Income Tax Act. It explains that if your business turnover exceeds ₹1 crore, an audit is generally required, unless you opt for presumptive taxation schemes like Section 44AD. The limits can be higher (up to ₹10 crore) if cash transactions are below 5% of your total turnover and receipts.

CA. Sourav Sarkar

Chartered Accountant

24588 Points Posted on 13 June 2021

If you're cash expenses is 5% then for tax audit t/o limit is 10 crores rupees subject to 5 crores rupees earlier and if cash expenses and receipts exceeds 5% then turnover limit will be 1 crores rupees. In this case tax audit might be applicable

jasmeet singh

220 Points Posted on 13 June 2021

Audit applicable under sec. 44ab if Turnover exceeds 1 cr.
if you don't want to get your accounts audit ,then
go for 44ad (presumptive taxation )and you can claim profit, not less than 8% for cash receipts and 6% for bank receipts . you can also show more profits.
Refer 44ab and 44Ad for detail analysis.