Tag: income tax audit due date extend

Tax Audit ITR Filing Deadline Extended: Key Dates and Penalties

ITR filing deadline for audit cases is Nov 15: file now to avoid penalties. If a taxpayer misses the deadline to file their income tax return by November 15, 2024, they still have the option to submit a belated return by December 31, 2024

The deadline for filing the income tax return (ITR) for FY 2023-24 is November 15, 2024, for those taxpayers subject to an income tax audit and other designated taxpayers. The original deadline was October 31, 2024.

The Central Board of Direct Taxes (CBDT) had extended the deadline for filing ITR for the Assessment Year 2024-25 to November 15, 2024, for taxpayers requiring audits. So the taxpayers will have more time to do a thorough audit before filing, said Alay Razvi, Managing Partner at Accord Juris.

What extension was given?

“As certain provisions of the tax audit report may impact the computation of income, it was necessary to provide them some additional time after the tax audit is over so that they can make necessary corrections to their computation of income,” said SR Patnaik, Partner (head – taxation) at Cyril Amarchand Mangaldas.

Who must file ITR by November 15?

a) Any corporate assessee

b) Any non-corporate assessee whose books of account are required to be audited under the Income Tax Act (I-T Act) or any other law for the time being in force

c) Any partner of a firm whose accounts are required to be audited under I-T Act or any other law for the time being in force or the spouse of such partner if the provisions of Section 5A (apportionment of Income between spouses governed by the Portuguese Civil Code) applies to such spouse).

For whom the ITR filing deadline was not extended

Extension does not imply for tax audit under sections 44AB and transfer pricing audit under section 92CE of the Income-tax Act, 1961.

Rahul Sateeja, partner at DMD Advocates, explained what happens if someone fails to file ITR by November 15.

Defaulters attract a fee of Rs 5,000 if total income is Rs 5 lakh or more. The fee will be Rs 1,000 in other cases under section 234F.

Interest at 1 per cent per month or a part thereof under section 234A.

Disallowance of carry forward of losses to subsequent years under section 80.

Disallowance of special income-based deductions under section 80AC.

Initiation of prosecution in rare cases which may extend up to seven years if ITR is not filed until the end of relevant AY i.e. March 31, 2025 under section 276CC.

Taxpayers have the option to file a belated return under section 139(4) on or before 31.12.2024 (as of now).

What can happen if you fail to file ITR 

If a taxpayer misses the deadline to file their ITR by November 15, 2024, they still have the option to submit a belated return by December 31, 2024. However, this will lead to certain penalties, including interest charges under Sections 234A and 234B. Additionally, a penalty under Section 234F will be applied, which may range from Rs 1,000 to Rs 5,000, based on the taxpayer’s income.

Income Tax Audit Due Date Extention Update

The income tax law mandates a specific class of taxpayers to conduct income tax audits. This audit involves a thorough inspection of the taxpayer’s books of accounts, particularly those with business or professional income. The primary aim of tax audits is to ensure the accuracy of financial records and income tax returns (ITRs). By mandating certain taxpayers to conduct a tax audit and submit its report, the law aims to deter tax evasion and discourage misrepresentation of income or inflation of expenses to reduce income tax payments.

What Is a Tax Audit?

In essence, a tax audit examines the books of accounts of a business or profession from an income tax perspective. It is typically carried out by practicing chartered accountants to verify the income tax returns of the concerned taxpayer.

Tax Audit Deadline and Applicable Taxpayers

The deadline for eligible taxpayers to conduct a tax audit and submit its report is September 30. The following categories of taxpayers are required to adhere to this requirement:

  • Taxpayers with Business Income:
    • If the turnover or gross receipts of a business exceed Rs 1 crore in a financial year, the business must get its accounts audited. This threshold is increased to Rs 10 crore if cash receipts and cash payments during the year do not exceed 5% of the total receipts or payments. Additionally, businesses opting for presumptive taxation under Section 44AD must also undergo an audit if the turnover exceeds Rs 2 crore.
    • Under presumptive taxation, for taxpayers with income from the business of plying, hiring, or leasing goods carriages, an audit is required if the turnover exceeds Rs 10 lakh.
  • Taxpayers with Professional Income:

Deadline for Tax Audit and ITR Filing

The deadline for submission of the income tax audit report is September 30. For taxpayers covered by the transfer pricing audit, the last date for completion of the tax audit is October 31. It’s important to note that books of accounts and related records are required to be maintained for eight years from the end of the relevant financial year.

The due date to file ITR for taxpayers liable for tax audit under section 44AB is October 31. If the taxpayer misses the deadline, they can still file the ITR after paying a penalty.

Exemption from Tax Audit Requirements

According to Section 44AB, if a person is already required to audit their accounts under another law, they are not required to perform a separate audit for section 44AB. Additionally, a tax audit is not required for a professional if their gross receipts are up to Rs 75 lakh, provided their cash receipts are less than or equal to five per cent of their total gross receipts.