There are various avenues through which a foreign company can establish its presence in India. This can be achieved by either registering a wholly-owned Indian entity or operating as a foreign company. In this article, we explore key aspects of the available business structures in India.

What Is Tax Audit?

It is a certification process conducted by a practicing Chartered Accountant to ensure that a taxpayer’s accounting records comply with tax laws. This systematic and regulatory approach verifies the authenticity of transactions recorded in the taxpayer’s books of accounts.

The certification is performed through the annual filing of Form 3CA/3CB and 3CD, during which a Chartered Accountant validates the taxpayer’s disclosed income and provides necessary qualifications. In essence, a tax audit certifies the entirety of the taxpayer’s income structure in accordance with the Income Tax Act, 1961.

Who Is Required To Undergo Tax Audit?

For K K Baranwal & Associates, if the income surpasses the relevant threshold limit, it is obligatory to undergo a tax audit conducted by a Chartered Accountant, as specified in Section 44AB of the Income Tax Act, 1961. Initially, this limit was Rs. 1 crore for businesses and Rs. 50 lacs for other professionals. However, this threshold has been revised to Rs. 5 crores from FY 2019-20 and further increased to Rs. 10 crores from FY 2021-22, subject to specific terms and conditions.

Penalty For Non- Compliance

The tax department imposes heavy penalty for not getting accounts audited under Income Tax Act. Penalty amounts to lower of:

  • 0.5% of the total sales, gross receipts or turnover.
  • INR 1,50,000/-

Benefits Of Tax Audit

  • Audited statement of accounts is generally demanded by banks and other financial institutions before extending loans to taxpayers. Thus, getting accounts audited under tax law helps in faster approval of loans.
  • When the books are audited, the chances of getting caught in tax scrutinies and assessments becomes lesser. Even if caught, the tax authorities place more reliance upon audited accounts, than non-audited accounts.
  • Audit boosts credibility of your brand and help you getting more business opportunities.

K K Baranwal & Associates manages your audit submissions, tax computations, TDS returns, refund status, and meticulous account copy maintenance with expertise and reliability.

What K K Baranwal & Associates Offers?

K K Baranwal & Associates boasts a team of highly skilled professionals with extensive experience in taxes and related fields. Our unwavering commitment is to maintain the trust our clients place in us through exceptional services.
K K Baranwal & Associates stands firmly on the foundations of knowledge, transparency, ethics, and customer satisfaction. These principles empower us to deliver superior results and success for our clients.

Services provided under Tax Audit

  1. Conducting audits under Section 44AB of the Act and filing certifications using Forms 3CA, 3CB, and 3CD.
  2. Filing Income Tax Returns.
  3. Preparation of Financials.
  4. Reconciliation between income as per books and as per tax audit.
  5. Filing of related certificates and forms.
  6. Tax Audit advisory.