Under Section 44 AB of the Income Tax Act, 1961, the provision of Income Tax Audit is taken place. An income Tax Audit is aimed to examine an individual’s organization’s tax returns by any outside agency. An income Tax Audit is covered to verify all income, and expenditure incurred, and get the deduction information. As per the act, the assessment year will be the year in which you declare the income for tax assessment and fill your returns.
A tax Audit is mandatory for all taxpayers
Do tax audit is mandatory under the provisions of the Income Tax Act. Under this provision, all taxpayers are required to do an audit of all the accounts of their organization or business. The Chartered Accountant performs the tax audit and is required to submission of all its findings and observations in the form of an audit report.
Section 44 AB is concerned with those classes of taxpayers who are liable to get their audit done by a Chartered Accountant. The Chartered Accountant has to file the Tax Audit Report to the income tax department electronically. After completing the Income Tax report by the Chartered Accountant, the taxpayer is required an approval submitted reports using an E-filing account with the Income Tax Department.
The objective of the Income Tax Audit
The objective of the tax audit process at ascertaining compliance with various income tax provisions. Before the due date, If the Tax audit report is not made then the taxpayers will have to pay a penalty. As per section 271B of the Income Tax Act, 1961, any delay in compliance may attract a penalty of either 0.5 percent of the total sales, turnover, or gross business receipts or Rs 1,50,000. As per Section 271B, if a person who is required to comply with Section 44AB is not able to get their accounts audited, then the penalty will be imposed on that person.
Section 271B states that if a person who is needed to comply with Section 44AB fails to get their accounts audited, then the person will give a penalty. Thus, a tax audit is compulsory for individuals. By the proper system of doing tax audits, it becomes possible for all businesses to do maintenance of books of accounts and other revenue or expense records systematically. Tax audit in a proper way ensures that total claims for deduction and income should be appropriately and properly done by the businessman. Failure to comply with the income tax rules would attract a penalty and individuals wishing to avoid any penalty should ensure full compliance with all the rules of the income tax audit.
The Tax Audit Due due date is extended by CBDT
The CBDT extends the due date for income tax audit report filling and the taxpayers till 7th October. The last date was September 30 but as per the demand of chartered accountants, the government decided to extend the tax audit due date for AY 2022-23. Generally, the income earned during the FY ( FY 2021-22), the immediate next year would be considered as the assessment year, i.e. Hence, the year 2022-23 is known as the assessment year. So, Before September 30, the taxpayers are required to get an audit for the assessment year 2022-23.
Paying consideration to taxpayers’ demand, the department took the decision to extend the date by a week. CBDT extends the due date for filing various reports of audit for Assessment Year 2022-23 from 30th September 2022 to 7th October 2022 for certain categories of assessees.
The due date is extended for the technical issues
Earlier, taxpayers took complaints on various social media platforms including Twitter demanding an extension on the due date, and the income tax portal is now working properly. As per the official statement, In consideration of difficulties faced by the stakeholders and taxpayers in the filing of various reports of audit for the AY 2022-23, the Central Board of Direct Taxes (CBDT) has taken a decision to extend the due date for filing of various reports of the audit.
In view of difficulties/technical issues, the government has taken this step which will be very beneficial for all the taxpayers for the Assessment Year 2022-23. This is a remarkable decision by the government.