Applicability of Tax Audit in India

My father age :60

He is not having any income.

He have intraday equity loss : 742140
Turnover : 1432056
Short term capital gains : 424310

Does he required to have tax audit.??

Some website i read that below 1Cr turnover Tax Audit is not applicable.?

Hi @KDN,

Tax Audit is applicable when

  • Turnover is above the threshold
  • Profit is less than 6% of the turnover & income is more than the basic exemption limit.

Since the income is below the basic exemption limit and the turnover is less the threshold tax audit is not applicable.

We are getting the issue fixed in the above determine tax audit applicability tool.

hi…myself shanmukh… I have salary income, arrears from salary, LTCG &STCG. I have traded in FnO and intraday prematurely… My intraday turnover is 600 and profit is +1/-(without expenses)…My options turn over is 58000 and loss of -15000/-(without expenses)… Which ITR i need to file?.. i think ITR 3 suits me based on readings from some QnA…Tax Audit is necessary in my case? a lot of confusion in that…kindly clarify me…thank you

@AkashJhaveri @Saad_C @Laxmi_Navlani @Divya_Singhvi @Kaushal_Soni can you?

Hi @Shanmukh

Since you had transactions in intraday and F&O ITR-3 will be applicable to you.
As per my opinion since the turnover and loss is very less a CA may not recommend a tax audit in your case.

Hope this helps :slightly_smiling_face:

can you tell me in what cases tax audit is applicable?..the tax audit tool in quicko is not working…kindly reevaluate the tool…


@Shanmukh, this will help.

kindly update page of tax audit too…it helps…

What is the criteria for maintaining book of accounts. If my taxable income is <2.5 lac and turnover, loss from intraday trading are 10k and 7k respectively, do I need to get it audit and maintain book of accounts too?

Hi @inquisitive,

You should, however file your ITR and report your losses to carry them forward. Tax audit won’t be applicable because your income is below the basic exemption limit of INR 2.5 Lakh and turnover less than the threshold of INR 10cr.

intraday profit 237000 turnover(239000)
short term profit 118000
charges (-81000)
futures profit 8000 turnover(8000)
options (-55000) turnover(9600000)

net profit is 194000
no salary income
do i need to audit as income is less than 2.5 lakh but turnover is near 1 crore
can i carry forward loss without audit by filing in itr 3 only and there will no penalty from itr?

Hi @mukhilan,

Tax audit won’t be applicable because your income is below the basic exemption limit of INR 2.5 Lakh and turnover less than the threshold of INR 10cr. You can file ITR 3 and report all your incomes, deductions and losses to carry forward the losses and set them off against future gains.

Learn more about tax audit in the below article

Okay and what about maintaining books of accounts… Is that necessary in my case?


Yes, since your turnover is more than 25 lakhs you need to maintain the books of accounts and prepare the financials and file ITR 3.

You can refer the below article for detailed applicability.

Hope this helps !

No mine is this case:

Hi @inquisitive

No need to maintain books of accounts and audit is also not recommended as per the income situation shared.

Hope this helps!

My total income after all deduction calculates to 2.7 lakhs .
My turnover is approximately 1.4Cr in trading Future and options and as well as equity combined.
I have a loss of around 1.7 lakhs In trading.
So is tax audit applicable and may I please know which ITR has to be filled.?

Hi @rqas_64,

Since F&O is treated as a non-speculative business income, you need to file ITR 3.


My salary income is more than 10 lakh and I have other sources of incomes such as STCG, dividend, interest amounting to 3-4 lakh.

I just have 5-6 trades in F&O with turnover of 88,000 with loss of -27,000 and expenses 16,000, net loss -43000.

I have never filed ITR 3 before and never used presumptive taxation scheme. Would appreciate carry over / set off of business loss.

Do I need to get a tax audit?

Hi @gurjot_ahluwalia,

Under the presumptive taxation scheme, you can declare your profits at a predefined rate and let go of maintaining books of accounts.
However, you cannot carry forward your losses under the presumptive taxation scheme.

This article might be helpful to carry forward and set off losses