Audit under 44AB

Can you please tell me which section says that if we declare less than 8% we have to get books of accounts audited for the FY 2016-17?
Replies (17)
There is no such provision. Only thing is that you have to maintain books of account
Then no need for audit is it? Even if i declare less than 8 percent?
Turnover from business should not exceed 1cr
mr.ganesh look, if u r filing ITR u/s 44AD and showing profit less than 8% than audit is compulsory
and if u r filing ITR under normal provisions than you ll have to prepare books of accounts and have to fill profit and loss acc as well as balance sheet than you can show below 8% profit also...also provisions of 1cr and 2 cr needs to be lookout..
If shown less than 8% than compulsory audit for next 5 years also benefit of 44AD, unless income is below limit
Benefit of 44AD not available for next 5 years
if your total income is exceeding the taxable limit and if it's less than 8% of total turnover then audit u/s. 44AB is compulsory as per subsection (5) of section 44AD
correct me if iam wrong

Agreed with Mr Rama Krishnan. 44AB(e) is the section applies. One minor addition, audit applies only if total income (all income heads) exceeds max exempt from tax.

44AD new amended sub section 5 says audit is applicable for those subsection 4 applies but in sub section 4 it doesn't talk about declaring less than 8%. Hence i feel Audit not required if i won't opt for 44AD and declare less than 8%.

Dear Mr Dowlath, I think the limit part is mentioned indirectly. Subsection 4 mentions the accordance to sub-section(1) and subsection(1) talks about the limit of 8%/6% depending upon nature of payment.

44AD (4)

"Where an eligible assessee declares profit for any previous year in accordance with the provisions of this section and he declares profit for any of the five assessment years relevant to the previous year succeeding such previous year not in accordance with the provisions of sub-section (1) ..."

as per subsection 5 of 44AD, Those assessees who fall under subsection 4 of 44AD, they are required to maintain books as per 44AA and get audited as per 44AB
which is nothing but the assessee who does not fall under 44AD section
@ RamaKrishnan Wrong interpretation
43[[4] Where an eligible assessee declares profit for any previous year in accordance with the provisions of this section and he declares profit for any of the five assessment years relevant to the previous year succeeding such previous year not in accordance with the provisions of sub-section [1], he shall not be eligible to claim the benefit of the provisions of this section for five assessment years subsequent to the assessment year relevant to the previous year in which the profit has not been declared in accordance with the provisions of sub-section [1].

[5] Notwithstanding anything contained in the foregoing provisions of this section, an eligible assessee to whom the provisions of sub-section [4] are applicable and whose total income exceeds the maximum amount which is not chargeable to income-tax, shall be required to keep and maintain such books of account and other documents as required under sub-section [2] of section 44AA and get them audited and furnish a report of such audit as required under section 44AB.]

assessees fall under only 2 categories. one who declares 8% of turn over under 44AD and the other under 44ad(4) which needs to be audited. it's my view. let's wait for experts advice

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
05 July 2026
Financial Controller

NovumLake Partners

Mumbai

CA

View Details
Company
06 July 2026
Chartered Accountant (Indirect Taxation)

Gowra Ventures Pvt Ltd

Hyderabad

CA

View Details
Company
ARTICLESHIP 08 July 2026
Article internship

AJAY SINGH AND CO LLP

Thane

CA Final

View Details
Company
23 July 2026
Semi qualified CA

Garg Bros & Associate CA

New Delhi

CA Inter

View Details
Company
ARTICLESHIP 17 July 2026
Article Assistant and B.com pass

BANSAL YOGESH AND CO

Gautam Budh Nagar

B.Com

View Details
Company
ARTICLESHIP 23 July 2026
Article

Gianender & Associates

New Delhi

CA Inter

View Details
Company
Featured 16 July 2026
Semi Qualified Company Secretary

Vakilsearch.com

Chennai

CS

View Details
Company
21 July 2026
Chartered Accountant

Keshri & Associates

Thiruvananthapuram

CA

View Details