TAX AUDIT
What is Tax Audit?
There are various kinds of audits being conducted under different laws,tax audit is an examination or review of accounts of any business or profession carried out by taxpayers from an income tax viewpoint.
Who is Mandatorily Subject to Tax Audit?
A taxpayer is required to have a tax audit if the sales, turnover or gross receipts of business exceed Rs.1 crore in the financial year (Subject to some exceptions) However, a taxpayer may be required to get their accounts audited in certain other circumstances.
What if a Person's account is already audited under any other law eg. Statutory Audit under Companies Law ?
In such cases, the taxpayer need not get his accounts audited again for income tax purposes. It is sufficient if accounts are audited under such other law before the due date of filing the return. The taxpayer can furnish this prescribed audit report under Income tax law.
Tax Audit Report Forms-
Tax auditor shall furnish his report in a prescribed form which could be either Form 3CA or Form 3CB where:
- Form No. 3CA is furnished when a person carrying on business or profession is already mandated to get his accounts audited under any other law.
- Form No. 3CB is furnished when a person carrying on business or profession is not required to get his accounts audited under any other law.
In case of either of the aforementioned audit reports, the tax auditor must furnish the prescribed particulars in Form No. 3CD, which forms part of the audit report.