Does Sec 44AB tax audit apply to me this year?
Source: Section 44AB of the Income-tax Act, 1961.
Answer the questions in order. The first "Yes" means tax audit applies for the year.
Trigger 1 — Business turnover
Is your business turnover / sales / gross receipts in the previous year:
- **Above Rs. 10 crore?** → Tax audit applies, regardless of cash position
- **Between Rs. 1 crore and Rs. 10 crore?**
- Is **both** the following true:
- Aggregate cash receipts ≤ 5% of total receipts, AND
- Aggregate cash payments ≤ 5% of total payments
- **Yes — both** — Tax audit does NOT apply (you are in the Rs. 10 cr safe-harbour zone)
- **No** (either threshold exceeds 5%) → Tax audit applies
- **Up to Rs. 1 crore?** → Tax audit does NOT apply on the turnover trigger alone (but check Trigger 3 below)
Trigger 2 — Professional gross receipts
Are your gross professional receipts above Rs. 50 lakh in the previous year?
- **Yes** → Tax audit applies
- **No** → check Trigger 3
Trigger 3 — Presumptive scheme opt-out
This trigger applies if you previously opted into Section 44AD (business) or 44ADA (profession) and have now opted out.
For Section 44AD opt-out:
- Are you reporting income LOWER than the presumptive percentage (6% of digital turnover / 8% of cash turnover)? AND
- Is your total income above the basic exemption limit?
For Section 44ADA opt-out:
- Are you reporting income LOWER than 50% of gross receipts? AND
- Is your total income above the basic exemption limit?
If both are true for either case — tax audit applies.
If tax audit applies
- File **Form 3CA + 3CD** (if accounts are already audited under another law, e.g., Companies Act) **OR**
- File **Form 3CB + 3CD** (if no other statutory audit)
- Due date: **30 September** of the assessment year
- ITR filing deadline becomes **31 October** of the assessment year
- Penalty for non-filing under Sec 271B: 0.5% of turnover, max Rs. 1,50,000
What to do next
If tax audit applies — engage a Chartered Accountant well before September. We typically recommend engagement letters by August at the latest, with field work running through September.
For tax audit engagements for FY 2025-26 (AY 2026-27), please reach out via the contact page.