Tax audit document checklist

What it involves and when it is due

A tax audit under Section 44AB (Section 63 of the Income-tax Act, 2025) is required where business turnover exceeds ₹1 crore (₹10 crore where cash receipts and cash payments are each within 5% of the total), where professional receipts exceed ₹50 lakh, and in some presumptive-scheme cases where lower profits are declared and income exceeds the basic exemption limit.

The audit report is due one month before the return due date. For FY 2025-26 (AY 2026-27), CBDT Circular No. 07/2026 extended the report date from 30 September to 21 October 2026, and the return date for audit cases to 21 November 2026. For FY 2025-26 and earlier, the penalty for not getting the accounts audited or not furnishing the report is 0.5% of turnover or receipts, up to ₹1.5 lakh (Section 271B). From Tax Year 2026-27 it is a fixed fee under Section 428(c) of the 2025 Act, as amended by the Finance Act, 2026: ₹75,000 for a delay of up to one month and ₹1,50,000 after that.

On the e-filing portal the taxpayer first assigns the form to the auditor, the auditor uploads the report with a DSC, and the taxpayer then accepts it from the worklist and e-verifies it (by DSC, or by EVC for individuals and HUFs). The report is treated as furnished only after the taxpayer accepts it.

Official forms

Common reasons for queries and rejections

• Report uploaded by the auditor but not accepted and e-verified by the taxpayer before the due date.
• Turnover in the books not reconciled with GSTR-1, GSTR-3B and the annual return.
• Payments to micro and small enterprises outstanding beyond 15 days, or 45 days under a written agreement, not identified for Section 43B(h).
• Cash payments over ₹10,000 to a person in a day (Section 40A(3)) and loans or deposits taken or repaid in cash over ₹20,000 (Sections 269SS and 269T) not listed.
• TDS not deducted or deposited late, which leads to a 30% disallowance under Section 40(a)(ia) for resident payees.
• Depreciation worked on the Companies Act rates instead of the income-tax block of assets.
• Loan and deposit confirmations, related-party list or stock records not available when the auditor asks.

Questions

Who has to accept the tax audit report on the portal?

The taxpayer (or the authorised signatory of the entity). After the auditor uploads the report, it appears in the taxpayer's worklist for acceptance and e-verification; until then it is not furnished.

Is a tax audit needed under the presumptive scheme?

Not if income is declared at or above the presumptive rate. It can be needed where a lower income is declared and total income exceeds the basic exemption limit, or where a business opts out of Section 44AD within the five-year lock-in.

What changes from Tax Year 2026-27?

The audit moves to Section 63 of the Income-tax Act, 2025 and the report is filed in Form 26 instead of Forms 3CA / 3CB and 3CD. The turnover limits are carried over.

Official sources

• Form 3CA-3CD user manual (incometax.gov.in)
• Tax audit report video guide (incometax.gov.in)
• Income tax forms and offline utilities (incometax.gov.in)