tax audit applicability

[Guest]

Dear Expert,

An Asseessee has a TO of 90L, his net pft <6/8%,Is he required to get his BOA audited under 44AB? without opting for 44AD can he still file ITR-3 WITHOUT AUDIT REPORT?

If so under which clause of 44AB?

As there is an amendment in clause e where previously it use to be business and now it is profession from 1/04/2017.

³²Every person,-

(a) carrying on business shall, if his total sales, turnover or gross receipts, as the case may be, in business exceed or exceeds one crore rupees in any previous year ; or

(b) carrying on profession shall, if his gross receipts in profession exceed ³³[fifty] lakh rupees in any previous year; or

(c) carrying on the business shall, if the profits and gains from the business are deemed to be the profits and gains of such person under section 44AE or section 44BB or section 44BBB, as the case may be, and he has claimed his income to be lower than the profits or gains so deemed to be the profits and gains of his business, as the case may be, in any previous year; or

(d) carrying on the ³⁴[profession] shall, if the profits and gains from the ³⁴[profession] are deemed to be the profits and gains of such person under ³⁵[section 44ADA] and he has claimed such income to be lower than the profits and gains so deemed to be the profits and gains of his ³⁴[profession] and his income exceeds the maximum amount which is not chargeable to income-tax in any ³⁶[previous year; or]

³⁷[(e) 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,]

34. Sub. for 'business' by Act No. 28 of 2016, (w.e.f. 1-4-2017).

35. Substituted for 'section 44AD' by Act No. 28 of 2016, (w.e.f. 1-4-2017)

AI Summary

Tax Audit Required Under Sec 44AB if Profit Below 6-8% Unless Using Sec 44AD Presumptive Taxation. An individual inquired about the necessity of a tax audit under Section 44AB for an assessee with a turnover of 90 lakh and net profit below 6-8%. The discussion highlighted that if income is disclosed below 6% (bank transactions) or 8% (cash and bank), a tax audit is mandatory unless opting for presumptive taxation under Section 44AD. It was also noted that businesses with turnover over 20 lakh must register for GST and file annual returns, which require an audit. One participant confirmed that maintaining books of accounts negates the need for an audit under Section 44AB post-amendment.