Audit under the Income Tax Act — Section 44AB
Tax audit, Form 3CA / 3CB and 3CD preparation and filing — completed before the 30 September deadline by an ICAI-registered Chartered Accountant from our Mumbai practice.
Section 44AB of the Income Tax Act, 1961 requires a Chartered Accountant to audit the books of account of any business whose gross turnover exceeds ₹1 crore (₹10 crore if cash transactions are ≤5%), or any professional whose gross receipts exceed ₹50 lakh. The tax auditor furnishes Form 3CA or 3CB (the audit report) together with Form 3CD (a detailed statement of particulars) by 30 September of the assessment year. Missing this deadline attracts a penalty under Section 271B of up to 0.5% of turnover, capped at ₹1.5 lakh.
Tax audit that protects you from scrutiny — not just from the penalty
A tax audit is not just a Form 3CD checkbox. Form 3CD has 44 clauses spanning loans and advances, depreciation, MSME payments, disallowable expenses, related-party transactions, deemed income and more. Each clause is a potential trigger for an Income Tax notice if reported incorrectly.
We conduct a proper substantive audit before completing Form 3CD, cross-check every clause against your books and GST data, and file through the Income Tax portal before the deadline. Clients also get a summary of reportable disclosures, deductions available and potential disallowances — so ITR preparation is smoother and assessment risk is lower.
- Applicable to business turnover > ₹1 crore (₹10 crore if ≤5% cash)
- Applicable to professional receipts > ₹50 lakh
- Form 3CA for companies already under statutory audit; Form 3CB for others
- Form 3CD — all 44 clauses verified, not auto-filled
- Filed on the Income Tax portal by 30 September
- Coordinated with ITR preparation and GST reconciliation
Who needs a tax audit under Section 44AB
Current thresholds for FY 2025-26. The presumptive taxation rules under Sections 44AD, 44ADA and 44AE also create audit obligations when opted-out.
| Category | Threshold | Form |
|---|---|---|
| Business — general | Gross turnover > ₹1 crore | 3CB + 3CD |
| Business — digital / low cash (≤5% cash receipts & payments) | Gross turnover > ₹10 crore | 3CB + 3CD |
| Profession | Gross receipts > ₹50 lakh | 3CB + 3CD |
| Business already under Companies Act / other statutory audit | Same turnover thresholds | 3CA + 3CD |
| Presumptive taxation opt-out — Section 44AD | Any turnover if declaring profit below 8%/6% | 3CB + 3CD |
| Presumptive taxation opt-out — Section 44ADA | Any receipts if declaring below 50% profit | 3CB + 3CD |
Not sure which form or threshold applies to you? Send us your details — we'll confirm in one call.
What our tax audit engagement covers
Every clause of Form 3CD verified — not copied from last year's report.
Form 3CA / 3CB Audit Report
Independent audit report confirming that the books of account are maintained as required and give a true and fair view of the year's transactions.
Form 3CD — All 44 Clauses
Detailed statement of particulars: depreciation, loans & advances, MSME payments, related-party transactions, deductions, TDS defaults and deemed income — all verified against source data.
GST Reconciliation
Cross-verification of taxable turnover as per books versus GSTR-1 and GSTR-3B — discrepancies identified and explained before Form 3CD is finalised.
Depreciation & Block Verification
Additions, disposals and rates verified against fixed asset registers and purchase invoices. WDV under the Income Tax Act reconciled with book depreciation.
Disallowance & Deduction Review
Identification of expenses likely to be disallowed under Sections 40, 40A, 43B — and deductions under Chapter VIA cross-checked for eligibility.
Portal Filing & Acknowledgement
Tax audit report uploaded on the Income Tax portal under the client's PAN, with filing acknowledgement shared and deadline tracked from day one.
Our four-stage tax audit process
Structured to close before your 30 September deadline — with no last-minute scramble.
Scoping & data request
Kick-off call, fixed-fee engagement letter and tailored document checklist — trial balance, GST returns, TDS data, asset register and bank statements.
Substantive testing
Revenue and expense verification, GST-to-books reconciliation, depreciation check, loan confirmations and clause-by-clause Form 3CD drafting.
Review & sign-off
Partner review of Form 3CD, draft shared with you for confirmation of factual particulars, then Form 3CA/3CB signed by the ICAI CA.
Portal filing
Report uploaded on the Income Tax portal, acknowledgement shared, and a summary of reportable items given to your ITR preparer.
Tax audit that reduces your assessment risk
Not just filed on time — filed with every clause verified.
All 44 clauses verified
We do not copy-paste last year's Form 3CD. Every clause is reviewed against current-year books and GST data.
Filed before 30 September
Deadline tracked from day one. No last-minute extensions and no Section 271B penalties.
GST-to-books reconciliation
Turnover differences between books and GST returns are identified and explained before Form 3CD is signed.
Disallowance flagged early
You see the list of likely disallowances before the ITR is filed — so there are no surprises at assessment.
Fixed fee, written upfront
Scoping call, then a written quote. No hourly billing and no end-of-year surprises.
Coordinated with ITR preparation
Our ITR filing, GST and TDS teams work alongside the tax auditor — one point of contact.
Tax audit questions businesses and professionals ask us
Straight answers before you engage a tax auditor.
Need your tax audit filed before 30 September?
Tell us your turnover, entity type and year-end. You'll get a fixed quote and a partner-level contact within one working day.
