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Tax Audit Under the Income Tax Act
As per the provisions of the Income Tax Act, 1961, an assessee must get their books of accounts audited if the business or professional turnover exceeds the prescribed threshold limit. The tax audit must be completed before filing the income tax return. This requirement ensures proper maintenance of books, accurate reporting of income, correct claim of deductions, and overall compliance with tax laws, helping the Income Tax Department assess the financial position of the assessee correctly.
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What Is a Tax Audit Under the Income Tax Act
A tax audit is the examination and verification of a taxpayer’s books of accounts from an income tax perspective to ensure correct reporting of income, deductions, and compliance with the Income Tax Act. Unlike scrutiny or investigation, it focuses on accuracy and transparency of financial statements. Similar to audits under other laws such as statutory, cost, or stock audits, tax audit is mandatory for certain taxpayers. Our experts guide businesses at every stage, ensuring clarity, compliance, and smooth completion of the tax audit process.
Tax Audit Limit And Turnover Criteria
The tax audit limit varies based on several important factors, including the type of taxpayer (business or professional), total turnover or gross receipts, whether presumptive taxation has been opted for, and the nature of transactions cash or digital. Since these criteria are regularly updated by the Income Tax Department, staying compliant can be confusing. Our team ensures that you accurately assess your eligibility and comply with the latest notified tax audit turnover limits, helping you avoid penalties and maintain smooth financial operations.
Stay Tax Audit Ready with BizFormation India
Ensure full compliance and avoid penalties with expert-managed tax audit under Income Tax Act services. Visit BizFormation India (https://bizformationindia.com/) to get seamless guidance and professional support for your tax audit requirements.
Tax Audit Due Date
Generally, the tax audit due date is 30th September of the assessment year. For businesses requiring transfer pricing reports, the deadline is usually 31st October. BizFormation India tracks all compliance timelines and ensures timely submission so you avoid penalties.
Forms Used in Tax Audit – Form 3CA, 3CB And 3CD
A tax audit report is filed electronically on the Income Tax portal using prescribed forms such as Form 3CA, Form 3CB, and Form 3CD. Form 3CA is applicable when the books of accounts are already audited under another law, such as the Companies Act, while Form 3CB is used when accounts are not audited under any other statute. Form 3CD is a detailed statement that includes particulars of income and expenses, loans, statutory compliances, deductions, TDS details, and other key financial information. BizFormation India ensures accurate preparation and timely submission of Form 3CA, Form 3CB, and Form 3CD, ensuring complete compliance with Income Tax regulations.
Why Choose BizFormation India for Tax Audit Services
With a team of experienced Chartered Accountants, we provide complete end-to-end support from documentation to final filing ensuring 100% compliance with Income Tax rules. Our services are designed to be affordable and transparent, with hassle-free online assistance that saves you time and effort. By focusing on timely filing, we help you avoid penalties and unnecessary stress. BizFormation India simplifies tax audit services in India, making the entire process quick, reliable, and stress-free for every taxpayer.
Documents Required for Tax Audit
We help you collect and organize all tax audit documents required, such as:
Our team ensures a smooth, error-free audit preparation process.
- Books of accounts
- Financial statements
- Purchase and sales registers
- Bank statements
- TDS records
- Ledgers and trial balance
- Fixed asset details
- Loan and investment details
Tax Audit Applicability – Who Needs a Tax Audit
Tax Audit Applicability for Businesses
A tax audit is required if a business’s turnover exceeds the prescribed tax audit turnover limit, which is generally ₹1 crore. However, if you opt for Presumptive Taxation (44AD), audit is required when turnover exceeds ₹2 crore.
Tax Audit for Professionals
Professionals like doctors, lawyers, architects, consultants, etc., require a tax audit if gross receipts exceed ₹50 lakhs.
Other Situations
You may also need a tax audit if you claim lower profits than prescribed under presumptive taxation schemes.
BizFormation India carefully evaluates who needs tax audit based on your business structure, turnover, and income.
Section 44AB Tax Audit Explained
Section 44AB tax audit mandates that certain categories of taxpayers must get their accounts audited by a Chartered Accountant and submit the audit report online. This includes businesses, professionals, and entities crossing specific turnover or income limits.
BizFormation India simplifies the entire tax audit under section 44AB explained process in a clear and practical manner for easy compliance.
We offer complete, end-to-end services including:
We evaluate turnover, income, and tax regime applicability.
Thorough review of financial statements and accounting records.
Accurate preparation of all forms as per audit requirements.
Review of TDS, depreciation, deductions, loans, and other statutory requirements.
Online submission through the income tax portal.
Tailored audit services for all sectors.
