Tax Audit Service in Delhi.

Tax audits in India are governed by Section 44AB of the Income Tax Act. Essentially, it’s an examination of business accounts from an income tax perspective, mandated when business turnover exceeds specific limits ¹. The main objectives of tax audits are to ensure accurate maintenance of accounts, report discrepancies, and verify tax compliance.

Who Needs a Tax Audit?
Tax audits are required for individuals, HUFs, firms, etc. with gross receipts exceeding Rs 1 crore in business or Rs 50 lakhs in profession ¹. However, if a person is already required to get their accounts audited under any other law, they don’t need to do it again for income tax purposes.

Types of Tax Audit Forms
There are three main types of tax audit forms:

– Form 3CA: For individuals already mandated to get their accounts audited under another law
– Form 3CB: For individuals not required to get their accounts audited under another law
– Form 3CD: A statement of particulars that needs to be submitted along with the return and Form 3CA

Consequences of Non-Compliance
If a tax audit is applicable but not conducted, it attracts penal consequences under Section 271B ¹. The penalty can be 0.5% of the total sales, turnover or gross receipts, or Rs 1,50,000, whichever is lower.