Question ID :
44861
082701
Whether it is compulsory to show 8% or 6% of sales as net profit to avoid tax audit if turnover of a prop firm is 99 Lacs (below one crore)
Posted by
Mahesh Kumar
on
May 29, 2025
Filed Under
AUDIT
No, it is not compulsory to show 8% or 6% of turnover as net profit if your turnover is below ?1 crore. However, it is required only if you want to avail the benefit of presumptive taxation under Section 44AD of the Income-tax Act, 1961 and avoid tax audit.
Posted by
CA. SURAJ KUMAR CHOUDHARY on
May 29, 2025
Answer ID :
85875
It is not compulsory.
Posted by
HARIOM ARORA on
May 29, 2025
Answer ID :
85903
1. If your turover is less than 1 cr and you maintain books of accounts then there is no requirement of tax audit and you can show any profit % as calculated after reducing expenses.
2. If your turover is less than 1 cr and you do not want to maintain books of accounts then you have to go for presumptive scheme and show profit @ 8% or 6% as the case may be
Posted by
NIRMAL KUMAR on
Jun 13, 2025
Answer ID :
85906
Yes.
Posted by
JAYESH KARIA on
Jun 13, 2025