Income Tax Return: While filing ITR, people have to keep many special things in mind and many reports also have to be filed while filing ITR. These also include audit reports. In such a situation, let us know which people have to file audit report while filing ITR.
Income Tax Filing: The salaried people had to file income tax return by 31 July 2023 this year. In such a situation, those who could not file income tax return till the due date can now file income tax return with late fee. Apart from this, as per the Income Tax Act 1961, certain categories of taxpayers are required to get their accounts audited for income tax purposes. In such a situation, do you know who all have to file audit report while filing ITR? Let’s know…
Who is required to get income tax audit done
Audit of accounts may also be required under other laws like Companies Act, 2013 etc. The tax laws of India mandate a certain class of taxpayers to get their accounts audited by a Chartered Accountant (CA). As per section 44AB, it is commonly known as tax audit. Its purpose is to ascertain the compliance of various provisions of the Income-tax Act (with accounts) and fulfillment of other requirements of the Income-tax Act. Taxpayers who are required to get their accounts audited will have to upload the audit report on the income tax portal by September 30 every year. Apart from this, the deadline for filing Income Tax Return (ITR) for these taxpayers is 31 October.
Business income
A businessman is required to get his accounts audited if the total sales, turnover or gross receipts from the business during the previous year (i.e. the financial year for which ITR is to be filed) exceeds Rs.1 crore. However, this limit of Rs.1 crore shall be raised to Rs.10 crore if the cash receipts and cash payments during the year do not exceed 5% of the total receipts or payments, as the case may be.
Even if the turnover of a person is less than the audit limit, he may still be liable to audit if he is eligible for the Presumptive Tax Scheme under section 44AD. This requirement is applicable if his income exceeds the basic exemption limit and he has opted for the presumptive scheme in any of the previous five years but has not opted for the same in the current year (the year for which ITR is being filed) Chose the option to choose.
Professional income
A professional, such as a doctor or a chartered accountant, is required to get his accounts audited if the financial year for which the ITR is being filed and his gross receipts from the profession exceed Rs 50 lakh. However, if a professional, as defined in section 44AA, declares his income to be less than 50 per cent of his gross receipts, he is required to get his accounts audited under section 44AB even if his gross receipts are within the audit limit i.e. 50 lakhs should be less than Rs.
