Things to know about the Tax Audit
Posted by entersliceindia on October 9th, 2018
Audit is all about review. Tax audit involves the process of reviewing or examining of the books of accounts of a business entity to confirm the income tax computations, deductions and other such financial calculations have been done in compliance with Income Tax laws of the country. Tax audit enables easy income tax computation as well as Income Tax Return filing easy. The Tax Audit limit is regulated by Section 44D of the Income Tax Act. Person carrying business or in a profession have to be get their books of accounts audited compulsorily under Section 44AB pertaining to certain tax audit applicability.
The tax audit applicability categories the following persons who have to undergo the audit process on a mandatory basis:-
The presumptive taxation scheme under Section 44AD mentions that tax audit is not required for persons who are enrolled for the scheme and have a turnover of less than INR 2 crore annually.
Purpose of Tax Audit
Tax Audit Report Format
The audit report is required to be furnished either through –
Tax audit applicability has a legal validation only if submitted by a Chartered Accountant or a firm of Chartered Accountants or a Statutory Auditor. The tax audit report needs to be signed by the accountant or the auditor who has performed the audit.
For e-filing the online tax audit form, the report needs to be signed by the accountant or the auditor as well as his membership number needs to be mentioned alongside. The audit report first needs to be submitted to the concerned person or taxpayer digitally to get his approval before the online tax audit is filed electronically.
There is a tax audit limit for Chartered Accountants too. They cannot undertake more than 60 tax audits in a year.
The penalty for not getting the books of accounts audited for persons who are compulsorily required to get the audit done is 0.5% of the turnover or gross receipts, with a maximum limit of Rs. 1.5 lakh. The penalty is levied under Section 271B of the IT Act. However, the person is given a chance to give reasons for non-compliance, and if found acceptable, no penalty is imposed.
The audit report needs to be obtained before or by 30th September of the said assessment year. Only the 3CE report has a due date of 30th November of the said assessment year. More info visit http://blogs.montevideo.com.uy/blognoticia_164124_1.htmlAlso See: Tax Audit, Income Tax, Audit Report, Persons Carrying, Tax, Report, Audit
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