For certain taxpayers, apart from filing returns, additional compliance for Tax Audit is required to be fulfilled if the turnover exceeds specified limits. Tax Audit is mandatory when the turnover from the F&O Trading business crosses the threshold limit of ₹10 Crores.
Tax Audit is the review of books of accounts by a Chartered Accountant (CA).
Let’s say, you are involved in the F&O Trading business, and the turnover from the same is ₹11.5 Crores. In this case, you are required to get the books of accounts audited as it crosses the limit of ₹10 Crores.
Also, in certain cases, even if you incur losses in the F&O Trading business, you are required to fulfill the compliances of Tax Audit. For example, if your turnover from the F&O Trading business is ₹54 lakhs but you have incurred losses of ₹15 lakhs, then you have to get a tax audit conducted.
Let’s understand if tax audit is applicable to you or not by referring to the below table:
From the above table, one can determine according to the Turnover and Income situation whether Tax Audit is applicable or not. If one has opted for Presumptive Taxation Scheme and incurred losses then one needs to get Tax Audit conducted.
Use the calculator to Check the Tax Audit Applicability
If Tax Audit is applicable, there are some additional compliances that need to be fulfilled:
- Get your books of accounts related to the F&O trading business audited by a CA in Practice.
- Get the audit report uploaded by the Chartered Accountant and approve the same before 30th September of the immediate next financial year, failing which a penalty will be levied.
- File your Income Tax Return before 31st October of the immediate next financial year.
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