A tax audit is required for a business whose turnover exceeds ₹1 crore. The limit is ₹10 crore if cash receipts and cash payments are each within 5% of the total. For professionals, it applies when gross receipts exceed ₹50 lakh, or ₹75 lakh where cash receipts are within 5%.
A tax audit is also required where income is declared below the presumptive rate under certain conditions. The audit report in Form 3CA or 3CB with Form 3CD is due by 30 September, a month before the return.
Key points
- Penalty for not getting audited: 0.5% of turnover, up to ₹1.5 lakh
- Maintain books, bank reconciliations and fixed asset registers
- Report GST, TDS and loan details accurately in Form 3CD
General information only, not professional advice. Section references are to the Income-tax Act, 1961; corresponding provisions of the Income-tax Act, 2025 apply from 1 April 2026. Thresholds and dates may change by notification.
CA Rahul Rajendra MohiteACA, M.Com · ICAI Membership No. 622387 · Founder, Rahul R. Mohite & Co., PuneFirm profile and key facts