Suppose Mr. A turnover below 1 crore in section 44AD.
But this year, in books of accounts, there profit is coming less than 6%.
Can they still show profit of more than 6% in ITR & escape from Tax audit?
Profit exceeds Maximum amount of income not chargeable to tax.
10 Replies
Ankit Neema
(2742 Points)
Replied 28 July 2021
In my view, if you are showing minimum 6%/8% profit of turnover then Audit is not required. Even if you have lower profit in Books and you decide to declare minimum 6/8% then no audit required.
Hari Beldona
(ACA)
(1533 Points)
Replied 28 July 2021
Tax paid by the assessee under Section 44AD is calculated at 8% of the individual's gross turnover for the financial year, provided that his or her gross turnover is below Rs 1 crore. This limit has been raised to Rs 2 crore as per the Budget 2020.
CA. Sourav Sarkar
(Chartered Accountant )
(24583 Points)
Replied 28 July 2021
Yes if profit is showing greater than 6% of turnover then tax audit should be escaped
debora M
(BUSINESS DEVELOPMENT MANAGER)
(1697 Points)
Replied 28 July 2021
The Income-tax Law requires the taxpayer to get the audit of the accounts of his business/profession from the view point of Income-tax Law. A person carrying on business, if his total sales, turnover or gross receipts (as the case may be) in business for the year exceed or exceeds Rs. 1 crore.
Hari Beldona
(ACA)
(1533 Points)
Replied 28 July 2021
In budget 2020 this 1 crore limit increased to Rs. 2 Crores
Priya Sharma
(Account Manager)
(167 Points)
Replied 29 July 2021
Yes. Mr.A can show a profit of 6%/8% and can skip tax audit.
Ankit Neema
(2742 Points)
Replied 29 July 2021
Why 8%, when in 44AD option given to declare 6% profit on the turnover which is other than cash and 8% in case of turnover is through cash
Nidhi
(Chief Accountant)
(3150 Points)
Replied 29 July 2021
Yes. Mr.A can show a profit of 6%/8% as the case may be u/s 44AD and escape the tax audit u/s 44AB
Recent Topics
- Form 3CEAB
- Form 3CEAA and Form 3CEAB
- DIR 3 Web KYC
- Can i declare LTCG income as business income if I
- Stock entry in new software
- I have an EMI collection shop, what is its SAC cod
- Making payment once in quarter possible under QRMP
- Master File Documentation related
- Applicability of 44AD needs clarification
- ITC reversal in GST 3B
Related Threads
CAclubindia
