Applicability of Rs. 5 crore threshold Tax Audit limit from AY 2020-21 onwards

• January 6, 2021
• CA Chandan Agarwal's Office

Will threshold limit of 5 crore as mentioned in 44AB applicable for AY 2020-21?

Yes, it will be applicable.

NOTE: The discussion in article is only w.r.t Tax Audit for person carrying on Business.

FACTS:

1) Before amendment, applicable limit u/s 44AB for getting Tax Audit done is 1 crore.

44AB clause a in FA 2019

(a)  carrying on business shall, if his total sales, turnover or gross receipts, as the case may be, in business exceed or exceeds one crore rupees in any previous year

2) ‘Clause a’ of section 44AB was amended by Finance Act No. 12 of 2020 with an insertion of proviso . Such amendment  is effective from 01-04-2020.

Read more on: https://taxguru.in/income-tax/applicability-rs-5-crore-threshold-tax-audit-limit-ay-20-21-onwards.html