Tax Audit Services
“A tax audit is an independent examination of an entity’s financial records by auditors as required by the Income Tax Act of 1961.”
For any assessee who is the subject of an audit, timely, accurate, and transparent tax return filing is a crucial task. An independent tax auditor is required to carry out the task in order to accomplish this. We take great care to maintain the highest ethical standards and the highest calibre of services because we fully appreciate the sensitivity and significance of tax for businesses and other assessees.
What is Tax Audit?
According to Section 44AB of the Income Tax Act of 1961, a company must have its accounts audited by a chartered accountant if its annual gross receipts or turnover exceed a certain threshold. Form numbers 3CA/3CB and 3CD, the chartered accountant’s tax audit report, contain his conclusions and observations.
TAX AUDIT V/S STATUTORY AUDIT
A statutory audit and a tax audit are very different from one another. To ensure that the company’s financial statements are accurate, precise, transparent, and reliable, a statutory audit is carried out. A tax audit, on the other hand, is carried out to ensure accurate data is reflected in the company’s taxable income and deductions as well as to ensure proper bookkeeping.
If a taxpayer’s receipts or turnover exceed the limits for tax audits as described below, whether t business or professional, must undergo a tax audit:
Tax audits are applicable if a business’s annual gross revenue exceeds Rs. 1 Crore.
The tax audit limit is Rs. 2 crore for taxpayers who have chosen presumptive taxation under Section 44AD.
From the financial year 2019–20 onward, the tax audit limit is Rs 5 crore for taxpayers whose total cash receipts and payments during the previous year did not exceed 5% of all receipts and payments.
For Professionals :
If the annual gross receipts of an assessee who’s a professional exceeds Rs.50 Lakh then, the assessee has to get the audit done.
Additionally, the audit is necessary when the taxpayer reports a lower net profit while reporting a profit under sections 44AD, 44ADA, or 44AE.
Tax Audit Due Date
The assessee is required to file an audit report on or before 30th September of the assessment year.
Tax Audit Penalty
As per Section 271B of the Income Tax Act 1961, the penalty for non-filing of the audit report is lower of:
- 1) 0.5% of the total sales, turnover, or gross receipt
- 2) Rs. 1,50,000
Objectives of Tax Audit
- 1) Ensuring the maintenance, accuracy, and certification of the books of accounts by a Chartered Accountant.
- 2) Auditors detection of discrepancies in the books of accounts so that they can be fixed and accurate records can be kept.
- 3) Delivering the necessary data in the report format required by the tax authorities, including tax deductions, depreciation, and compliance with various legal provisions.
- 4) Ensuring that the tax return is accurate and that it is filed according to the Income Tax Act’s requirements.
Tax Audit Process
- 1) Appointment
- 2) Acceptance of Engagement
- 3) Pre-auditing Meeting
- 4) Audit Planning
- 5) Audit Execution
- 6) Audit Report
- 7) Follow Up
We firmly believe that our clients are our best asset, and in order to provide customer-centric services, we must put ourselves in their position and provide exactly what they require. We understand that you are looking for an auditor who properly delves into nuances to comprehend all of the intricate laws, rules, and regulations governing the Indian tax system. At CAnest, we have a team of tax experts who draw on their years of experience and knowledge from a variety of sources. We make sure to offer you a seamless combination of tax auditing and compliance services.