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Return purpose

satyanarayana (Accountant) (149 Points)

21 November 2017

Sir,

My Business Turn over is Rs 5444803.00 in 2016-17.

Now we ill file income tax return with out auditing .or with auditing.

Audinting to be need for my business turnover or not necessary .

Kindly Guide us what is auditing slabs ?

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11 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160322 Points)
Replied 21 November 2017

No audit required provided your net taxable income from the business (& not profession) is 6/8% or more......

1 Like

RAJA P M ("Do the Right Thing...!!!") (127058 Points)
Replied 21 November 2017

Dear Sir.,
In case we maintain books of accounts as above then
why we show the profit 6/8%...?

2 Like

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160322 Points)
Replied 21 November 2017

SECTION 44AB(d):

carrying on the business shall, if the profits and gains from the business are deemed to be the profits and gains of such person under section 44AD and he has claimed such income to be lower than the profits and gains so deemed to be the profits and gains of his business and his income exceeds the maximum amount which is not chargeable to income-tax in any previous year,

get his accounts of such previous year audited by an accountant before the specified date and [furnish by] that date the report of such audit in the prescribed form duly signed and verified by such accountant and setting forth such particulars as may be prescribed.

Here 6% of the 54 lakhs is more than 3 lakhs.......... including incomes other heads....... it would be more than basic exemption limit......... so, section 44AB triggers for individual/HUF and P Firm.....

2 Like

RAJA P M ("Do the Right Thing...!!!") (127058 Points)
Replied 21 November 2017

Dear Sir.,

Thank you for your valuable reply...

The IT want 8%/6% under 44AB/AD then

Why we can move it 44AB...?

Why not we can avail 44AD...? bcoz, no more difference both sections without audit...!!!

My T/O Rs. 40lakhs... I ll go to 44AD and show the profit Rs. 320000/- also it's same under sec 44AB. Then why I ll keep my books of accounts without any benefits for both sections...

1 Like

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160322 Points)
Replied 21 November 2017

Yes, you are correct........

And that is the policy adopted by Government........ Just give us tax over (Deemed) profit of (average) 6/8%.......... whether you earn or not, but we will not trouble you!!!

Policy:: to reduce backlog..........and to reduce administrative workload where there is no positive gain (what extra will you earn more then 8% in such competitive market???)............

That is the reason for.... Policy like 1. Turnover limit u/s. 44AD raised to 2 Cr.

2. If you do not opt 44AD for any one year........ you will not be able to opt for next five years !!! (An open threat....... challangeable in court).....

Overall business persons would be happy to go for 44AD, as you said.......

1 Like

RAJA P M ("Do the Right Thing...!!!") (127058 Points)
Replied 21 November 2017

Sir.,
As per above T/O less than 8/6 percent then we must under audit...?!

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160322 Points)
Replied 21 November 2017

Yes,

Two conditions........... a) profits declared less then 6/8% alongwith

b) total income above minimum exemption limit.......

1 Like

RAJA P M ("Do the Right Thing...!!!") (127058 Points)
Replied 21 November 2017

Sir.,
please give any examples for "b"

1 Like

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (160322 Points)
Replied 22 November 2017

In this particular case itself ::: Say, the assessee declares income of 2 lakhs (less than 6% over T/O of 54.44 lakhs,) from the business along with other incomes like bank FD interest, or lottery winning, or even salary, commission etc....... exceeds 50 K......... so the total income exceeds Rs. 2.50L, i.e. basic exemption limit for an assessee (below 60 age)............ So, condition b) gets satisfied and audit applicable as per sub-section 44AB(d)...........

The limit in case of Partership firm reduces to ZERO.