2. A) For Resident Individual /HUF/Firm (excl LLP) ( i.e. So if the provisions of sec 44 Ab and provisions of Sec 44 AD is not applicable to him, then there is not any limit regarding % of profit to Total Sales. Or is it a mandatory exemption? Sec 44AD not applicable), Aggregate cash payments ≤ 5% total payments. 1] His aggregate of all receipts in cash during the previous year does not exceeds 5 % of such receipts. Section 44AB gives the provisions relating to the class of taxpayers who are mandatorily required to get their accounts audited from a chartered accountant. The five clauses of section 44AB under which tax audit can be carried out are – a. 5 crore if the following conditions are satisfied –. assessment year 1998-99, provides that in the case of an assessee carrying on a business of the nature specified in sections 44AD, 44AE , tax audit will be required, if he claims his income to be lower than the presumptive income deemed under the said sections. Under section 44AB of the Income-tax Act, 1961, it is obligatory for certain specified persons, carrying on business or profession to get their accounts audited by an ‘accountant’ and submit a copy of the ‘audit report’ in prescribed form (Form No. Since in todays world many small salaried or business have some commitment under 80C and other deductions which results into lower Net Taxable Income under Old Regime. 92/2020- CT to 94/2020- CT, Extend due dates for Income Tax Audit & Returns for AY 2020-21, Extend Tax Audit/ITR due dates for AY 2020-21, ICAI requests for extension of various Income-tax due dates, Extend Due Dates for Tax Audit and Income Tax Return Filing, Extend Income Tax Audit & ITR Due dates for AY 2020-21, Extend due dates of Audit Reports, ITRs, GST Returns, VSV Scheme, Extend due date for filing ITR & Tax Audit Report- AY 2020-21, Extend Tax/TP Audit & ITR Due dates for AY 2020-21, Open letter for extension of Due dates under Income Tax and GST, Gross receipts from profession in the financial year, Profits and gains (as a % of total Gross receipts), Total sales, turnover or gross receipts in the Financial year, Profits and gains (as a % of total sales, turnover or gross receipts). Does it mean that if the turnover exceeds Rs. All Rights Reserved. This section provides for audit of accounts of assessees having total sales, turnover or gross receipts exceeding the specified limits of Rs.40 lakhs for business and Rs.10 lakhs for profession. This section applies in a case wherein section 44AD(4) applies. 5 crores in cases where the aggregate cash receipts AND aggregate cash payments made during the year does not exceed 5% of total receipt and total payment respectively. Tax audit clause 44ab(d) or (e) This query is : Resolved Report Abuse Follow Query Ask a Query. A person is having commission business, 44AD not applicable to it, turnover is 80 Lakhs, and profit is 3 percent, Is audit applicable?? Section 44AB. However, tax audit may be applicable under clause (b), (c), (d) & (e) when Sec 44AB is read with Sec 44AD. [ii] whose total turnover or gross receipts in the previous year does not exceed an amount of two crore rupees. These provisions have effect from.AY 2020-21, A pensioner is getting more than 5 lakhs Rupees as salary income and getting 2 lakhs Rupees from profession (with 51% as expenditure). Clause (c) of section 44AB, inserted by the Finance Act 1997 w.e.f. Because , Sec 44 AD [1] provisions applicable to eligible business. 2021-22…Please refer Bare Act and reply please after checking. However, w.e.f. The report of the tax audit conducted by the chartered accountant is to be furnished in prescribed form i.e. Section 44AB of Income Tax Act. The author shall not be responsible for any extracts or references made. The only option left is to go for audit u/s 44AB(e) which again is a debatable topic. (b) aggregate of all payments made including amount incurred for expenditure, in cash, during the previous year does not exceed five per cent of the said payment, this clause shall have effect as if for the words “one crore rupees”, the words “five crore rupees” had been substituted; or, (b) carrying on profession shall, if his gross receipts in profession exceed fifty lakh rupees in any previous year; or, (c) carrying on the business shall, if the profits and gains from the business are deemed to be the profits and gains of such person under section 44AE or section 44BB or section 44BBB, as the case may be, and he has claimed his income to be lower than the profits or gains so deemed to be the profits and gains of his business, as the case may be, in any previous year; or, (d) carrying on the profession shall, if the profits and gains from the profession are deemed to be the profits and gains of such person under section 44ADA and he has claimed such income to be lower than the profits and gains so deemed to be the profits and gains of his profession and his income exceeds the maximum amount which is not chargeable to income-tax in any previous year; or. 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