Every country has its own rules and regulations that need to be followed by every citizen of the country. The same is the case with India, which has different types of ‘audit statutory’ for audits, cost audits, and stock audits. All these types of audits are done to ensure that books of accounts are error-free and are all according to the rules and regulations of the Income Tax Act under the tax audit section 44AB. The Income Tax Audit is the examination of books of accounts by a professional. This will involve all the assessment of deductions claimed; income earned assessment of income tax returns and all other provisions under the income tax act.
Here is the list of the objective of the Income Tax audit:
- To properly audit the financial statements for tax purposes and ensure that all the records are maintained properly.
- The books of accounts will reflect the true image of the taxpayers and also provide information regarding the claims that can be made for deductions.
- Certification of all the books of accounts by a professional auditor.
- To report all the requirements of Form No. 3CA, 3CB, and 3CD.
- A report of all the observations is made by the tax auditor.
- Proper check is maintained so that there is no fraud or malpractice done by any taxpayer while filing income tax returns.
- All the essential details regarding loans, advances, deductions, depreciation, compliances are made with the provision of the income tax act. This will help in proper verification of all the income, expenditures, claims of deductions, etc.
- It will help in saving the time of the Assessing Officer for carrying out routine verifications. This saved time can be utilized for investigating more aspects of a case.
Every taxpayer needs to undergo a tax audit if their books of accounts exceed the sale of Rs. 1 crore in a financial year. So, if you are the person that falls in this category are liable to get tax audit reports. Here is the step-by-step procedure for filing the tax audit reports. Let’s have a look at them.
- First of all, the Chartered Account will present the tax audit reports of the business online by using their login credentials. Even chartered accountants must have their individual assigned so that they can conduct audits for the individual or organization.
- All the taxpayers need to mention all the details regarding their accounts to the chartered accountant on their platform.
- After this, the audit reports are uploaded by a chartered accountant. The taxpayer is provided with two options, either to accept the reports or reject them. If the taxpayer rejects the reports, they need to undergo the whole process again.
These reports can only be filled by chartered accounts or the firm of accountants. These reports need to be filled before or on the due date of income tax return filing day. The due date is 30th November of the subsequent assessment year who is involved in an international transaction during the financial year. The due for normal taxpayers is 30th September of the subsequent assessment year.