A person with a company or professional income must keep a lot of records in case of an ITR audit. Accounts, a cash book, a ledger, a journal, etc. are among the documents on the list. Additionally, each of these documents needs to be kept in accordance with the guidelines and in a particular manner. Actually, the government requires high-income businessmen to undergo income tax audits. Audits are essential to guarantee fair revenue collection, accurate reporting, and stop tax evasion.
Financial statement
What records must be kept on hand in case of an income tax audit? For all parties who are required to perform an income tax audit, the same papers are needed. However, some additional paperwork is also necessary for professionals in the legal, engineering, medical, etc.
The Cash Book, which contains all daily cash transactions,
is among the crucial records for an income tax audit.
- Â A journal.
- a ledger where all debits and credits will be recorded.
- Bill in carbon copy form.
Original invoices that were sent to the person and receipts for the related expenses. However, taxpayers would only be needed to save signed payment vouchers if bills and receipts have not been given and the expense incurred does not exceed Rs 50.
Account Statement
Along with the aforementioned, each taxpayer who is the subject of an income tax audit must keep track of his financial statements, including a trial balance, a profit and loss statement for the fiscal year, a balance sheet, etc. The medical practitioner should also submit Form No. in addition to the aforementioned. Daily Case Register in 3C, as well as inventories for the start and last days of the preceding year, are necessary. And September 30, 2023, is the deadline for income tax audits for the fiscal year 2022–2023 (AY 2023–24). The deadline for submitting ITR and the audit report together is October 31, 2023.
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