02 August 2024
For your situation, where your gross receipts from a profession are ₹2,40,000 per annum, here's a breakdown of the requirements under Sections 44AA and 44AB:
### **Section 44AA: Maintenance of Books of Account**
**Requirement:** - **Section 44AA** mandates that professionals (e.g., doctors, lawyers, accountants) must maintain books of account if their gross receipts exceed ₹1.5 lakh in any financial year.
**Your Situation:** - Since your gross receipts are ₹2,40,000 per annum, you are required to maintain books of account under Section 44AA.
**Books to Maintain:** - **Cash Book**: Record of all cash transactions. - **Journal**: Record of all business transactions in a chronological order. - **Ledger**: Summary of all transactions recorded in the journal. - **Other Documents**: Supporting documents for expenses, receipts, and other financial transactions.
### **Section 44AB: Tax Audit**
**Requirement:** - **Section 44AB** requires a tax audit if the gross receipts from the profession exceed ₹50 lakh in a financial year.
**Your Situation:** - Since your gross receipts are ₹2,40,000, which is below the ₹50 lakh threshold, a tax audit under Section 44AB is not required.
### **Summary of Your Obligations:**
1. **Books of Account**: You must maintain books of account as your gross receipts exceed ₹1.5 lakh. 2. **Tax Audit**: A tax audit is not required as your gross receipts are below ₹50 lakh.
**Additional Points:**
- Even though a tax audit is not required, maintaining proper books of account is essential for accurate reporting and compliance. - Proper documentation and maintenance of accounts will also help in case of any future scrutiny or queries from the Income Tax Department.
**Action Steps:** - Ensure you maintain accurate and complete books of account for your profession. - File your income tax return correctly, including all the income and expenses as per the maintained books. - Keep records and supporting documents for at least six years in case of any future inquiries or assessments.