Comprehensive Tax Audit Service under Income Tax Act 1961

A tax audit is a systematic examination of a taxpayer's financial records, accounts, and other relevant documents to ensure compliance with the provisions of the Income Tax Act, 1961. It is a mandatory requirement for certain taxpayers, prescribed under Section 44AB of the Act, and aims to verify the accuracy and completeness of the information provided in the tax returns filed by the taxpayer.

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At Finitra Finnovation, we understand the complexities and nuances of tax laws in India, particularly the provisions laid out in the Income Tax Act of 1961. Our team of experienced Professionals specializes in providing comprehensive tax audit services to businesses and individuals across diverse industries.

Key points regarding tax audits:

  • Businesses: If the total sales, turnover, or gross receipts (as the case may be) in business exceed Rs. 1 crore. The threshold limit for a tax audit of a business is increased If cash transactions are limited to 5% of total gross receipts/payments, the turnover threshold increases to Rs. 10 crores. However, this provision does not apply to individuals who opt for the presumptive taxation scheme under section 44AD and whose total sales or turnover doesn’t exceed Rs. 2 crores. Or Rs.3 Crores if cash transactions are less than 5%.
  • Professionals: If the gross receipts from a profession for the year exceed Rs. 50 lakhs. However, this provision does not apply to individuals who opt for the presumptive taxation scheme under section 44ADA whose total receipts don’t exceed Rs. 75 Lakhs and whose cash transactions are less than 5%
  • Presumptive Taxation Scheme: Various scenarios apply, such as when a person eligible for the presumptive taxation scheme claims profits or gains lower than the scheme’s computation, or when an eligible assessee opts out of the scheme.