When a Business exceeds a certain statutory figure in total sales, it is required to undergo a Tax Audit. Business organizations like Companies require various types of statutory audits.
And we have a group of competent as well as experienced Chartered Accountant and C.S for making different types of Tax and Statutory Audit for your organization. If these types of audits are done properly at the right time, your organization will prosper financially. To be safe in the eye of law, all taxation matters, bank loans, increase your CC limits you must have to complete your Tax as well as statutory Audit properly on time.
DNRLGK is committed to undertake all these audits for your organizations.
What is Tax Audit ?
A tax audit is the process of verification and inspection of the accounts of a taxpayer to confirm their adherence to the provisions of the Income Tax law. Section 44AB of the Income Tax Act, 1961 deals with the Audit of the Accounts of a certain category of persons carrying on a business or engaged in a profession.
Who is eligible for Tax Audit ?
A taxpayer is required to have a tax audit carried out if the sales, turnover or gross receipts of business exceed Rs 1 crore in the financial year. However, a taxpayer may be required to get their accounts audited in certain other circumstances.
What is Statutory Audit ?
A statutory audit is compulsory for every company, even if the company has no turnover. Tax audit, on the contrary, is mandatory for every organisation whose annual turnover is more than ₹ 1 crore and the gross receipt is more than 25 lakhs for professionals.
The judiciary of India considers a statutory audit a mandatory audit for the corporate selector. The purpose of conducting the audit is to maintain the legal accounting records of the company. The law of companies act of 2013 has guided the appointment of auditors, removal of the auditor, The auditor’s rights and duties, and remuneration.
The auditor performs the audit according to the guidance of the law, and the audit will apply to the organisation. The companies can appoint the auditor by taking approval from its shareholders at the time of the annual meeting. In that case, they also have the authority regarding the auditor’s remuneration.
Under the Companies Act of 1956, the registered colonies could hire a chartered accountant. The company can hire such a person after preparing the final statements of the company’s account records. When the audit is done, the statutory auditor will submit his report.
Conclusion:
Therefore, it is clear that statutory audits and tax audits are entirely different in their purposes. The purpose of a statutory audit is wider than a tax audit.
Moreover, a statutory audit is compulsory for every company, but a tax audit applies to companies/other business houses under the Income-tax Act.
Requested to get connected to DNRLGK and get the best legal assistance for your organisation, including statutory and tax audits.