Tax audit u/s 44ab

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

24 August 2018 Whether I am required to get my books audited?? if my net profit is below 8% and I m not opting for sec. 44AD and showing my income in business and profession head.
My turnover is below 1cr. and upto last year my books are audited.

Sanket

Sanket (Expert)
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25 August 2018 According to Section 44AB of the Income Tax Act 1961 (updated upto 2018) the Tax Audit limit for

Business :

Rs. 1 Crore. It means an assessee need to be audited under Sec.44AB if his annual gross turnover/receipts in business exceeds Rs. 1 Crore. This provision is applicable from F.Y. 2016-17 (A.Y. 2017-18) & onwards. It means the limit of Tax Audit u/s 44AB is Rs. 1 Cr. for Business in FY 2017-18 / AY 2018-19.

Profession :

Rs. 50 Lakh. It means an assessee need to be audited under Sec 44AB if his annual gross receipts in profession exceeds Rs. 50 Lakh. This provision is applicable from F.Y. 2016-17 (A.Y. 2017-18) & onwards. It means the limit of Tax Audit u/s 44AB is Rs. 50 Lakh for Profession in FY 2017-18 / AY 2018-19.

What is Presumptive Taxation Scheme (Sec 44AD) ?

Sec 44AD provides special provision for computing profits and gains of business on presumptive basis. You need not to maintain proper accounting. Your net income is estimated to be @8% of your gross receipt/turnover. From F.Y. 2016-17, net income is calculated as @6% of gross receipts are received through digital mode of payments and @8% of gross receipts are received in cash.

Businesses, whose annual gross turnover/receipt does not exceeds Rs. 2 Crore are eligible for this scheme.

Hope you got your answer.