I t return

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Vaibhav

Vaibhav (Querist)
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01 September 2014 Is it complsary to file return before audit report not done

Vaibhav

Vaibhav (Querist)
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01 September 2014 Is it complsary to file return before audit report not done

Asha Kanta Sharma

Asha Kanta Sharma

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28 July 2024 In India, the requirement to file an Income Tax Return (ITR) before the audit report is completed depends on several factors, including the type of taxpayer, the nature of the business, and the applicable provisions of the Income Tax Act. Here’s a detailed explanation:

### **1. **General Requirement**

For most taxpayers, the ITR must be filed by the due date specified under the Income Tax Act, regardless of whether the audit report is completed.

### **2. **Tax Audit Provisions**

Under the Income Tax Act, taxpayers engaged in certain types of businesses or professions are required to have their accounts audited. The audit report must be filed along with the ITR for those subject to audit.

#### **Audit Requirements**
- **Section 44AB**: This section mandates tax audit for businesses or professions if their turnover exceeds specified limits (e.g., ₹1 crore for businesses or ₹50 lakh for professionals). The audit report should be filed in Form 3CD and submitted to the Income Tax Department.

### **3. **Filing of ITR and Audit Report**

#### **Before the Audit Report is Completed**
- **For Audit-Required Cases**:
- **Due Date for Filing ITR**: The ITR must be filed by the due date, which is generally 30th September of the assessment year for taxpayers subject to audit.
- **Audit Report Submission**: The audit report must be filed before the ITR is filed. However, in practice, you can file your ITR once the audit is substantially complete, even if the final report is not yet submitted.

#### **If the Audit Report is Not Ready**
- **Estimate and File**: If the audit report is not completed by the due date, you should still file the ITR based on the information available. You can file the ITR with provisional figures and subsequently update it if needed, based on the final audit report.

#### **Consequences of Delay**
- **Penalties and Interest**: If the ITR is not filed by the due date, you may face penalties and interest on the unpaid tax. Additionally, filing after the due date without a valid reason may lead to complications and additional scrutiny.

### **4. **Compliance Strategy**

- **Timely Filing**: Aim to file the ITR by the due date to avoid penalties and interest. If the audit is ongoing, file the return with the best available information and update it if required.
- **Seek Extensions**: If necessary, request an extension for filing the audit report or ITR from the Income Tax Department, but ensure that you comply with the general filing deadline.

### **Summary**

- **ITR Filing**: It is mandatory to file the ITR by the due date even if the audit report is not finalized.
- **Audit Report**: Ideally, the audit report should be completed before or around the time of filing the ITR. If it is not ready, file the return with provisional figures and update it if necessary.
- **Consultation**: For specific cases and compliance, especially in complex situations, consult with a tax advisor or auditor to ensure proper adherence to filing requirements and deadlines.

By following these guidelines, you can ensure timely and compliant filing of the ITR even if the audit report is pending.

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