Understanding Audit Exemptions Under Section 44AB

Learn who is exempt from audits under Section 44AB, including income limits and presumptive taxation schemes.

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Individuals with gross receipts below the specified threshold are not liable for audit under section 44AB. Additionally, those opting for the presumptive taxation scheme (under sections 44AD, 44ADA, or 44AE) and declaring income as per these provisions, with gross receipts under Rs. 2 crore for businesses and Rs. 50 lakh for professions, are also exempt.

FAQs & Answers

  1. Who qualifies for exemption from audit under section 44AB? Individuals with gross receipts below the specified threshold and those opting for presumptive taxation schemes (sections 44AD, 44ADA, or 44AE) are exempt if their gross receipts are under Rs. 2 crore for businesses and Rs. 50 lakh for professions.
  2. What is the income threshold for businesses to avoid an audit under section 44AB? For businesses, the income threshold to avoid an audit under section 44AB is Rs. 2 crore.
  3. What are presumptive taxation schemes under tax laws? Presumptive taxation schemes under sections 44AD, 44ADA, and 44AE allow eligible taxpayers to declare their income as per specified thresholds rather than maintaining detailed accounts.
  4. Are professionals exempt from audit under section 44AB? Yes, professionals can be exempt from audit under section 44AB if their gross receipts are below Rs. 50 lakh and they opt for the presumptive taxation scheme.

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For more insights on tax compliance and regulations, check out our other videos that explore nuances of the Income Tax Act, presumptive taxation schemes, and tips for small business accounting. Staying informed can help you make better financial decisions and ensure you are meeting all legal requirements effectively.

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