Question
My business turnover is growing and I want to know at what point a tax audit becomes compulsory.
Answer
A tax audit under Section 44AB is required if business turnover exceeds Rs 1 crore, but the limit rises to Rs 10 crore where both cash receipts and cash payments are 5% or less of the totals. So a largely digital business can stay below audit up to Rs 10 crore. For professionals, the limit is gross receipts above Rs 50 lakh. A tax audit is also triggered if you opt out of presumptive taxation and declare lower profits while crossing the basic exemption. The audit report (Form 3CA/3CB and 3CD) is filed by a chartered accountant before the due date.
This answer is general information based on the law as it stood when written and is not professional advice on your specific situation. Verify the current position and consult a qualified professional before acting. See our disclaimer.