Is the Amendment made by Finance Act, 2020 Applicable for those entites who has been in Audit for the last 3-4 years?
Is it comulsory for them to get the accounts audited? or the limit of 5Cr made in finance act is applicable?
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Tax Audit for the A.Y 2020-2021
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5 crs audit limit is applicable from a. y. 2021-22
What about those Entities who were in audit for last 3-4 years and in the A.Y 2020-2021 thier turnover Is below 5Cr and also if both the conditions are satisfied?
A taxpayer is required to have a tax audit carried out if the sales, turnover or gross receipts of business exceed Rs 1 crore in the financial year. However, a taxpayer may be required to get their accounts audited in certain other circumstances. We have categorised the various circumstances in the tables mentioned below:
NOTE: The threshold limit of Rs 1 crore for a tax audit is proposed to be increased to Rs 5 crore with effect from AY 2021-22 (FY 2020-21) if the taxpayer’s cash receipts are limited to 5% of the gross receipts or turnover, and if the taxpayer’s cash payments are limited to 5% of the aggregate payments.
NOTE: The threshold limit of Rs 1 crore for a tax audit is proposed to be increased to Rs 5 crore with effect from AY 2021-22 (FY 2020-21) if the taxpayer’s cash receipts are limited to 5% of the gross receipts or turnover, and if the taxpayer’s cash payments are limited to 5% of the aggregate payments.
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