Last yr 44AD claimed , turnover 10 lac
Current year, do not want to claim 44AD, turnover 15 lac but having profits 5 lac i.e. more than 8%
Is audit must this year?
4 Replies
Aliasgar Samniwala
(118 Points)
Replied 03 July 2019
Last year you had claimed 44AD. but not mentioned whether Tax audit is conducted or not. If in last year you have claimed 44AD and your profit is more than 8% than in current year you DO NOT required to get your books of accounts audited u/s 44AB(e). But in case in last year, you have shown profit less then 8%, and books of account being audited, than you compulsarily required to get your books of account audited for next 5 years as per sec 44AD(4). hope you get clear idea of it. for any other querry plz revert back.
Jaideep Kumar
(Articled Assistant)
(52 Points)
Replied 03 July 2019
44AD(4): Where an eligible assessee declares profit for any previous year in accordance with the provisions of this section and he declares profit for any of the five assessment years relevant to the previous year succeeding such previous year not in accordance with the provisions of sub-section (1), he shall not be eligible to claim the benefit of the provisions of this section for five assessment years subsequent to the assessment year relevant to the previous year in which the profit has not been declared in accordance with the provisions of sub-section (1)
44AB: Every Person carrying on the business shall, if the provisions of sub-section (4) of section 44AD are applicable in his case and his income exceeds the maximum amount which is not chargeable to income-tax in any previous year, get his accounts of such previous year audited by an accountant before the specified date and furnish by that date the report of such audit in the prescribed form duly signed and verified by such accountant and setting forth such particulars as may be prescribed
As the text of section says where an assessee files a return declaring profit on presumptive basis, then for the subsequent 5 years he will not get the benefit of Section 44AD, also
This means if we have opted for Presumptive income in preceding previous year and wants to opt out of presumptive Income scheme in previous year (although declaring profit more than 8%) we have to get our accounts audited.
44AB: Every Person carrying on the business shall, if the provisions of sub-section (4) of section 44AD are applicable in his case and his income exceeds the maximum amount which is not chargeable to income-tax in any previous year, get his accounts of such previous year audited by an accountant before the specified date and furnish by that date the report of such audit in the prescribed form duly signed and verified by such accountant and setting forth such particulars as may be prescribed
As the text of section says where an assessee files a return declaring profit on presumptive basis, then for the subsequent 5 years he will not get the benefit of Section 44AD, also
This means if we have opted for Presumptive income in preceding previous year and wants to opt out of presumptive Income scheme in previous year (although declaring profit more than 8%) we have to get our accounts audited.
Aliasgar Samniwala
(118 Points)
Replied 03 July 2019
yes that's correct interpretation. even in subsequent year you declare income more than 8% still you required to get your books of account audited.
Recent Topics
- NRO Interest - Taxed at source and in Foreign Coun
- Clarity needed on effective date
- Income Tax Refund Deadline Shortened to Five Years
- Rectification Applications for Past GST Demands
- Where can I find a trusted provider to hire a skip
- GST Invoices Series
- FILING OF ITR AY 20-21
- CLAIMING OF U CLAIMED RCM
- Building construction works
- REGARDING GSTR-9 F.Y 2023-24
Related Threads
CAclubindia
