It is time for you to start preparing yourself for filing your tax returns for the financial year 2020-21. However not everyone knows if they are liable to get audited under 1 or many of the applicable tax or compliance laws in India.
One of the most commonly applicable audit laws in India for a company, firm or an individual are Statutory audit under companies act and Tax audit as per Income Tax Act. GST Audit which was applicable until FY 2019-20 has now been discontinued.
But what makes you liable for either of this Audit?
Let’s look a simple table to understand the reasons that would make you liable for an Audit :
|
Basis of difference |
Statutory AuditFor Companies | Statutory AuditFor LLP’s | Tax Audit |
| Applicability | Only for Companies | Only for LLP’s | All Legal Entities |
| Whom is it meant for | All Companies registered under Companies Act (ROC) | LLP’s whose turnover exceeds, in any financial year, forty lakh rupees, or whose contribution does not exceed twenty five lakh rupees | Any entity whose business has a turnover of more than Rs. 5 Crore the taxpayer’s and cash receipts of which are limited to 5% of the gross receipts or turnover, and if the taxpayer’s cash payments are limited to 5% of the aggregate payments. |
| Reason for conducting Audit | To check the whether all the disclosures and compliances have been made according to the Companies Act | To check the whether all the disclosures and compliances have been made according to the LLP Act | To verify if the income and expenses disclosed during the year have been calculated as per the Income Tax act. |
| Audit to be conducted by ? | Chartered Accountant | Chartered Accountant | Chartered Accountant |
| Report Submission | Shareholders | Shareholders | Income Tax Department |
| Nature of Audit | Mandatory | Conditional | Conditional |
| Due Date of Submitting Audit report* | 31st October | 31st October | 30th September or 30th November |
To understand more details kindly contact growth@slate.ac/dhaval@slate.ac or call us at 8828125995
*Note: These are due dates provided as per the respective acts however due to COVID Government has brought extensions to the same.
