An assesse opt for presumtive income @ 8% u/s 44AD For AY 19-20
Now suppose in next year ie AY 20 -21 his turnover is 1.8 crores and he shows his taxable profit as 5.4l (3%) .However during the year receipt in cash is less than 5% of total receipt
And also payment in cash is less than 5% of total payment
Will he required to get his Tax audit u/s 44AB
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Regarding tax audit query
Replies (3)
Yes as opting for presumptive taxation you have to maintain 44AD for 5 years and as profit is less than 8% of turnover then tax audit is compulsory u/s 44AB
Now suppose in last 10 year his t/o is less than 2 cr and he always get his account audited u/s 44AB then also will he require to get his account audited in CY , keeping all the case being same
As the last date is gone your penalty will be 0.5% of turnover i.e. Rs.90000 approx
Instead you declare income u/s 44AD on your cheque or online sale @ 6% and on remaining sales @ 8%.
in your case taxable income will be
1.8 crores x 95% x 6% = Rs. 1026000
1.8 crores x 5% x 8% = Rs. 72000
Total taxable = Rs 1098000
Roughly tax will be around Rs. 142000 + Late fees for ITR Rs. 10000
Instead if you go for tax audit only penalty will be Rs. 90000 and tax is additional.
So you decide the same as per your case.
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