22 January 2014
Is it compulsory to do audit under section 44AB in the following situation?
Turnover 80,00,000 Deemed profit as per section 44AD:-560000(8%) Actual Profit shown :- 1,50,000
As per section 44AB when we are showing profit below 8% and income exceed the basic exemption limit than audit is compulsory. Since my income is below 200000 audit is not compulsory as per me. Am I Right? Please help me
22 January 2014
Your profits and gains from the business are lower than 8% but your total income does not exceeds the maximum amount which is not chargeable to income-tax, in such situation, you are required to keep and maintain such books of account and other documents as required under sub-section (2) of section 44AA but the audit is not required.
22 January 2014
And if we follow this conditions than no person will pay tax in such type of situation and income tax department cant do anything as that person is not required to maintain books and also not require audit of accounts.
22 January 2014
But here you are not computing profit u/s 44AD. You are not showing profit @8%. So you have to maintain books if profit is less than 8% and turnover is more than 10 lakh.
23 January 2014
In Section 44AA it is written that if u r covered u/s 44AD then books will be required to be maintained only if u r showing less than 8% and ur income is below taxable limits
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