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Tax Audit Applicability Checker — Section 44AB (FY 2025-26)

“Do I need a tax audit this year?” is one of the most common questions CA clients ask. The answer depends on entity type, total turnover, mode of receipt (cash vs digital), whether presumptive taxation was opted, and whether declared income meets the prescribed percentage. Section 44AB of the Income Tax Act mandates audit for businesses with turnover above ₹1 crore (or ₹10 crore when cash transactions are ≤5%), professionals with gross receipts above ₹50 lakh, and taxpayers under presumptive schemes who declare income below the threshold. This checker walks through every condition and gives a clear YES or NO with the specific section number and reasoning — so your CA firm can advise clients instantly and without ambiguity.

Step 1 — Entity Type

Step 2 — Income Sources

Select an income source above to begin.

Section 44AB Thresholds (FY 2025-26)

TaxpayerThresholdSection
Business (cash >5%)₹1 crore44AB(a)
Business (all digital, cash ≤5%)₹10 crore44AB(a)
Specified Profession₹50 lakh44AB(b)
44AD — declared below 8%/6%Mandatory if income > exemption44AB proviso
44ADA — declared below 50%Mandatory if income > exemption44AB proviso
Company₹10 crore (digital norms apply)44AB(a)

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Frequently Asked Questions

Who needs a tax audit under Section 44AB?+
A tax audit under Section 44AB is required for: (1) Businesses with turnover exceeding ₹1 crore (or ₹10 crore if cash transactions are ≤5%), (2) Professionals with gross receipts exceeding ₹50 lakh, (3) Persons under presumptive scheme who declare income below the prescribed percentage (8%/6% for 44AD, 50% for 44ADA) and have total income above the basic exemption limit.
What is the ₹10 crore limit for tax audit?+
The ₹10 crore threshold applies only when both cash receipts AND cash payments are each ≤5% of the total receipts/payments. If cash transactions exceed 5% in either direction, the lower ₹1 crore threshold applies.
Is tax audit required under Section 44AD presumptive scheme?+
If you opt for Section 44AD but declare income below 8% of turnover (or 6% for banking/digital receipts), you must get accounts audited if total income exceeds the basic exemption limit. If income is below the exemption limit (e.g., ₹2.5 lakh for individuals below 60), no audit is needed even with lower declared profits.
Who performs a tax audit and what report is submitted?+
Tax audit must be performed only by a Chartered Accountant (CA) who is in practice. The CA submits Form 3CA-3CD (for accounts already audited under another law) or Form 3CB-3CD (for others) on the income tax portal. The due date is typically 30 September of the assessment year.
What is the penalty for not getting a tax audit done?+
Under Section 271B, the penalty for failure to get accounts audited or furnish the audit report is 0.5% of turnover/gross receipts, subject to a maximum of ₹1,50,000. The penalty may be waived if there is a reasonable cause for the failure.

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