Tax Audit Guide for AY 2025-26: Everything You Need to Know

 

📘 Tax Audit Guide (AY 2024-25 & AY 2025-26): Applicability, Limits, Due Dates & FAQs

Author: 1FinSolutions | Updated: July 2025

As the Assessment Year (AY) 2025-26 approaches, taxpayers—especially businesses and professionals—must prepare for a critical compliance requirement: Tax Audit under Section 44AB of the Income Tax Act. This guide from 1FinSolutions simplifies the concept, thresholds, due dates, and recent changes so you're well-prepared.

---

🔍 What is a Tax Audit?

A tax audit is an examination of your financial records by a Chartered Accountant (CA) to verify the correctness of income declarations, deductions claimed, and compliance with tax laws. It aims to ensure transparency and curb tax evasion.

---

🧾 Who is Liable for Tax Audit in AY 2025-26?

Here’s a breakdown based on business and profession:

📌 For Businesses:

• If total turnover exceeds ₹1 crore, a tax audit is required.

• However, if cash receipts and payments are limited to ≤ 5%, the threshold increases to ₹10 crore.

📌 For Professionals:

• If gross receipts exceed ₹50 lakh, tax audit is applicable.

⚠️ Under Presumptive Taxation (Sec 44AD / 44ADA):

• Opting out after earlier use, or declaring profits below the prescribed % with income above the basic exemption limit—requires a tax audit.

---

📆 Due Date for Tax Audit Report (Form 3CA/3CB & 3CD)

• 31st September 2025 (likely deadline for AY 2025-26)

• Filed electronically using the Income Tax Portal.

---

🧾 Documents Required

To start your tax audit, keep these ready:

• Ledger accounts (sales, purchases, expenses)

• Bank statements

• GST returns

• Previous year’s tax audit report (if any)

• Details of loans, advances, and TDS returns

---

🔄 Recent Changes to Note

• Audit Limit Re-evaluated: Businesses with digital payments benefit from an increased threshold (₹10 crore).

• Penalty for Delay: ₹1.5 lakh or 0.5% of turnover (whichever is lower) for non-compliance under Section 271B.

• Updated clauses in Form 3CD include details of GST reconciliation and reporting under section 43B(h) for MSME payments.

---

✅ How 1FinSolutions Can Help

At 1FinSolutions, we simplify tax audits for businesses, professionals, and startups by:

• Ensuring error-free financials

• Providing audit-ready financials

• Offering compliance consulting

• Coordinating directly with CAs

---

✉️ Ready to Get Started?

Book a free consultation for your Tax Audit AY 2025-26 👉 📲 Click to WhatsApp

Or visit: 🌐 www.1finsolutions.online