Is tax audit required in case of loss?
08 October 2016 Sub Section (1) of section 44AD reads as follows: and in case of “loss” the total income does not exceeds the maximum amount which is chargeable to income-tax so no need to get the books of accounts audited.
Is audit compulsory for partnership firm in case of loss?
In case of partnership firm, exemption limit is NIL. Since there is a loss, the income DOES NOT EXCEED the exemption limit and accordingly audit is NOT required.
Who is liable for tax audit?
A taxpayer is required to have a tax audit carried out if the sales, turnover or gross receipts of business exceed Rs 1 crore in the financial year. However, a taxpayer may be required to get their accounts audited in certain other circumstances.
What if tax audit is not done?
If a taxpayer who is required to obtain tax audit does not get the accounts audited, then penalty could be levied under Section 271B of the Income Tax Act. The penalty for not completing tax audit is 0.5% of the turnover or gross receipts, subject to a maximum of Rs. 1,50,000.
Is tax audit compulsory for company?
A tax audit is mandated on all companies, limited liability partnerships (LLPs), and individuals whose turnover crosses a particular threshold limit. Taxpayers who get their accounts audited under any other law do not have to get their accounts audited again for a tax audit.
What companies need to be audited?
A company must have an audit if at any time in the financial year it has been:a public company (unless it’s dormant)a subsidiary company within a group which is not small.an authorised insurance company or carrying out insurance market activity.involved in banking or issuing e-money.More items…•