Tax Audit Engagement Letter (Section 44AB / Section 63)
See the terms agreed between a tax auditor and an assessee before a tax audit, with the report forms for each year.
Law version: FY 2025-26 (Income-tax Act, 1961); Tax Year 2026-27 onwards (Income-tax Act, 2025). Checked on 26 Sep 2026.
What it is
A business whose turnover, or a professional whose gross receipts, exceed the limits in the income-tax law must have its accounts audited and the report furnished by the due date. For FY 2025-26 the tax audit is under Section 44AB of the Income-tax Act, 1961, with the report in Form 3CA or 3CB and the particulars in Form 3CD, even when reported after 1 April 2026. From Tax Year 2026-27 it is under Section 63 of the Income-tax Act, 2025, with the report in Form 26. The engagement letter sets out the scope, responsibilities and reporting, following the ICAI Guidance Note on Tax Audit.
When it is used
- Businesses with turnover above the tax audit limit.
- Professionals with gross receipts above the limit.
- Presumptive taxpayers declaring lower profits where audit is required.
What the template covers
- Auditor and assessee details
- Status, PAN and address of the assessee
- Trigger for the tax audit
- Report form and year
- Responsibilities of the assessee and the auditor
- Reporting date and UDIN
Details you will need
The generator asks for the following. Fields marked with an asterisk in the form are required; the rest can be left blank and filled in later in Word.
Letter
Letter Date
Audit Firm
Audit Firm Name; FRN; Firm Address; Engagement Partner; Membership No.
Client
Client (Assessee) Name; Status of Assessee; PAN; Address
Audit Scope
Trigger for Tax Audit; Audit Report Form; Financial Year / Tax Year; Audit Fee (₹, plus GST); Expected Reporting Date
Stamp duty, registration and filing
The limit is ₹1 crore of turnover, raised to ₹10 crore where cash receipts and payments are each within 5%, and ₹50 lakh of gross receipts for professionals, with separate rules for presumptive taxation. Failure to get the accounts audited can attract a penalty of 0.5% of turnover, up to ₹1.5 lakh. The report carries a UDIN. Check the current limits and due dates, including any CBDT extension, on incometax.gov.in.
The tax audit for FY 2025-26 is under Section 44AB (Forms 3CA/3CB and 3CD), even when reported after 1 April 2026. From Tax Year 2026-27 it is under Section 63, with the report in Form 26.
Generate the Tax Audit Engagement Letter (Section 44AB / Section 63)
Fill in the form and download the draft as a Word file. It is a general template, not legal or professional advice; have it reviewed for your facts before you sign or rely on it.
Related documents
Frequently asked questions
Which form is used for the tax audit of FY 2025-26?
Form 3CA or 3CB with Form 3CD, under Section 44AB, even though it is filed after 1 April 2026.
What is the form from Tax Year 2026-27?
Form 26 under Section 63 of the Income-tax Act, 2025.
What is the penalty for not getting a tax audit done?
0.5% of turnover or gross receipts, up to ₹1.5 lakh, unless there is reasonable cause.
This page gives general information for reference only. Laws, stamp duty rates and filing requirements change and differ between States, so confirm the current position for your case. Related: all document templates · free tax calculators · compliance calendar and guides.