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Month: June 2025

Updated TDS Provisions for Vendor Payments – Risk of Non-Compliance for FY 2025–26 Posted On June 27, 2025
Accounting Advisory ServicesAccounting FinancialAudit AssuranceAuditing Services

Updated TDS Provisions for Vendor Payments – Risk of Non-Compliance for FY 2025–26

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💼 Vendor payments are a routine but critical part of every business. However, failing to comply with Tax Deducted at […]

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Every taxpayer, especially business owners and professionals, must determine whether a tax audit under Section 44AB of the Income Tax Act is applicable for the financial year 2024–25. With evolving thresholds and digital compliance norms, here’s a complete checklist with examples to guide your audit decision. ❓ What is a Tax Audit? A Tax Audit is a detailed review of your financial records and compliance, mandated under Section 44AB of the Income Tax Act, 1961. It ensures: ✔️ Accuracy of income and deductions 📚 Proper maintenance of books 🕒 Timely filing of returns ✅ Checklist for Audit Applicability – FY 2024–25 🏢 Business (Non-Presumptive) – Section 44AB(a) Criteria Audit Requirement Turnover ≤ ₹1 crore Not required Turnover > ₹1 crore and ≤ ₹10 crore Required only if cash receipts/payments > 5% Turnover > ₹10 crore Always required 📌 Example 1: Mr. A runs a trading business with ₹7.5 crore turnover and 98% digital transactions. ➡ No Audit 📌 Example 2: XYZ Pvt. Ltd. has ₹12 crore turnover. ➡ Audit Required 🧾 Presumptive Taxation (Section 44AD) – Small Businesses Criteria Audit Requirement Turnover ≤ ₹2 crore, profit ≥ 8% (cash) / 6% (digital) Not required Turnover up to ₹3 crore (w.e.f. 1 April 2024), ≤ 5% cash receipts Not required Profit < prescribed % and income > exemption Audit Required 📌 Example 3: Retailer with ₹2.8 crore turnover, 96% digital, 6.5% profit. ➡ No Audit 📌 Example 4: ₹1.8 crore turnover, 4% profit, ₹12 lakh income. ➡ Audit Required 👨‍⚖️ Professionals (Section 44ADA) Criteria Audit Requirement Gross receipts ≤ ₹50 lakh, profit ≥ 50% Not required Up to ₹75 lakh, ≤ 5% cash receipts Not required Profit < 50% and income > exemption Audit Required 📌 Example 5: CA with ₹60 lakh revenue, 97% digital, 50% profit. ➡ No Audit 📌 Example 6: Consultant with ₹52 lakh revenue, 40% profit. ➡ Audit Required 🔄 Opting Out of the Presumptive Scheme 📌 Example 7: Mr. D opts out of presumptive in FY 2024–25. ➡ Audit required for 5 years 🚚 Transporters / Non-Residents (Section 44AE/44BB/44BBB) Audit applies if: Profit is below the deemed % and total income exceeds the exemption limit. 📑 Already Audited under Other Laws Audit under other laws counts as a valid Tax Audit if filed on time. 🗓️ Due Dates for Tax Audit – FY 2024–25 Particulars Due Date Tax Audit Report filing (without TP) 30th September 2025 Tax Audit Report with Transfer Pricing (Form 3CEB) 31st October 2025 ⚠️ Penalty for Non-Compliance If the audit is not conducted when required, Penalty = 0.5% of turnover/gross receipts, subject to a maximum of ₹1.5 lakh. Can be waived for reasonable causes like illness, natural calamity, etc. 🔚 Conclusion Know your numbers. Evaluate your turnover, digital vs. cash transactions, profit declaration, and income levels. This determines your tax audit requirement. With new relaxations for digital transactions, many small businesses and professionals can now avoid an audit, but only if conditions are met. 💡 Need help determining your audit requirement or filing returns? We’re here to assist with expert evaluation and timely compliance. ❓ Frequently Asked Questions (FAQs) Has the presumptive limit for businesses increased to ₹3 crore? ✅ Yes, from FY 2024–25 if total cash receipts are ≤ 5% What happens if I opt out of presumptive taxation after opting in? 🔁 If you opt out of Section 44AD in any one year, you cannot opt in again for the next 5 years, and tax audit becomes mandatory during that period (if income exceeds the exemption limit). Is tax audit applicable if I have already undergone an audit under another law (e.g., Companies Act)? 📄 Yes, but if such an audit is done and the report is submitted on time in Form 3CA & 3CD, it suffices for tax audit under Section 44AB. Can existing statutory audit under Companies/LLP Act replace tax audit? 📘 Yes, if the audit report (Form 3CA/3CB + 3CD) is filed on time under Section 44AB. What is the due date for filing the tax audit report for FY 2024–25? 🗓️ 30 September 2025, or 31 October 2025 if subject to transfer pricing audit. Posted On June 16, 2025
Accounting Advisory ServicesAccounting FinancialAudit AssuranceAuditing Services

Is an Audit Required? – Checklist for Tax Audit Applicability for FY 2024–25

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Every taxpayer, especially business owners and professionals, must determine whether a tax audit under Section 44AB of the Income Tax […]

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Key Changes in Income Tax Rules for FY 2024–25 (Assessment Year 2025-26) Posted On June 12, 2025June 12, 2025
Accounting Advisory ServicesAccounting FinancialAuditing ServicesITR

Key Changes in Income Tax Rules for FY 2024–25 (Assessment Year 2025–26)

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The financial year 2024–25 brings several crucial changes to India’s income tax landscape that every taxpayer, whether salaried, self-employed, or […]

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9 Key Updates in ITR-1 to ITR-4 for FY 2024–25 Posted On June 12, 2025June 12, 2025
Accounting Advisory ServicesAccounting FinancialBookkeepingITR

9 Key Updates in ITR-1 to ITR-4 for FY 2024–25

Posted By admin

1. Expanded Eligibility for ITR-1 Now allowed for individuals with: Family pension (not just salary/pension income) Income from other sources […]

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