QuestionsCategory: CA-Final Tax Auditchp-12-audit-under-fiscal-laws-app-of-tax-audit-limit
RahulRahul asked 10 months ago

For professionals whose Gross receipts < 50 lakhs and who claim their income to be less than 50%, is it mandatory to do tax audits. If yes, then has the government indirectly mandated to claim 50% income to avoid the hassle of tax audit? Thank you.

1 Answers
RaviRavi Staff answered 7 months ago

Yes Sec 44ADA states, For professionals , where gross receipts doesn’t exceed 50 lakhs, they can pay tax on presumptive profit of 50% under 44ADA .If they claim income to be less than 50 % & income exceeds the maximum amount which is not chargeable to income-tax in any previous year then Tax Audit will become Applicable.