Dear Professionals,
Please guide me if Tax audit is applicable in the below case:
Nature of the Company - Business (traders) and Turnover is 79lac during the year 2019-20. They are eligible assessee u/s/ 44AD. Upto the FY 2018-19, the assessee was covered under tax audit and it has been duly filed. However, during 2019-20, since the turnover is less than 2cr the assessee can avail 44AD but the assessee wants to show less than 8% profit. Is tax audit applicable if less than 8% profit is declared? (6% profit declaration is not applicable to this assessee)
Thank you in advance
Clarification on Tax Audit Necessity for Trading Company Under Section 44AD with Profit Below 8% and Turnover of 79 Lakhs A discussion participant inquired about the applicability of a tax audit for a trading company with a turnover of 79 lakh during the 2019-20 financial year. The company, previously subject to tax audits, is eligible to use Section 44AD due to its turnover being below 2 crore. However, the company intends to declare a profit of less than 8%. The query sought clarification on whether a tax audit is necessary under these circumstances. A respondent advised that, in their opinion, a tax audit is not required if the profit declared is less than 8%. (AI Summary)
TaxTMI 
TaxTMI 
