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TDS APPLICABILITY ON FIRST TIME AUDIT CASE

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AMIT BARSLE

STUDENT

41 Points Posted on 04 January 2022

Dear Experts,

Please guide me.

One of the friend had Turnover from construction business in Preceding FY 2019-20 was -40.00 lacs only & filed ITR U/s 44AD but F.Y. 2020-21 Turnover is 2.56 Cr. & fall U/s 44AB tax audit now. He was not deduct TDS in FY 2020-21.

He is liable to deduct TDS in FY 2020-21?? or From F.Y.20221-22??

Please give me expert advise what will do.

Replies (4)

Quick Summary

This discussion clarifies the applicability of Tax Deducted at Source (TDS) for a business that falls under tax audit (Section 44AB) for the first time in FY 2020-21, having had a turnover of ₹2.56 crore. The previous year's turnover (FY 2019-20) was only ₹40 lakhs, under Section 44AD. Experts advise that TDS deduction obligations typically commence from the financial year following the first audit, meaning TDS should be deducted from FY 2021-22 onwards in this specific case.

sabyasachi mukherjee

Profession Business

28246 Points Posted on 05 January 2022

TDS IS TAX DEDUCTED AT SOURCE.
TAX AUDIT IS DIFFERENT.

CA ABHAY GUPTA

Practice

3235 Points Posted on 05 January 2022

In case of Individual if his turnover exceeds Rs 1,00,00,000 in preceding FY then required to deduct tax in the following FY. In your case since the turnover was 40 lacs no need to deduct tax in FY 2020-21 but he needs to deduct tax from FY 2021-22...