As the financial year 2024–25 draws to a close, taxpayers subject to audit must gear up for critical compliance deadlines. The Income Tax Audit Report is a mandatory filing for certain businesses and professionals under Section 44AB of the Income Tax Act, and missing it can lead to steep penalties.
Key Deadlines
Tax Audit Report Submission: September 30, 2025
Income Tax Return (ITR) Filing (for audited entities): October 31, 2025
These dates apply to companies, proprietorships, and professionals whose income exceeds prescribed thresholds. The audit report must be filed before the ITR to avoid complications.
Who Needs a Tax Audit?
Businesses with turnover above ₹1 crore
If cash transactions are ≤ 5%, the limit increases to ₹10 crore
Professionals with gross receipts above ₹50 lakh
Presumptive taxpayers under Sections 44AD/44ADA/44AE, if declaring lower profits than prescribed and income exceeds exemption limits
Penalties for Non-Compliance
Under Section 271B, failure to file the audit report by the deadline can attract a penalty of 0.5% of turnover or receipts, capped at ₹1.5 lakh. Relief may be granted if a valid reason—such as illness or technical issues—is provided2.
What’s New in 2025?
The CBDT has amended Form 3CD, requiring additional disclosures:
Settlements related to legal contraventions
Buyback details under Section 2(22)(f)
MSME payment disclosures under the MSMED Act
EVC verification now allowed for Form 3CB–3CD
Best Practices
Consult a Chartered Accountant early
Maintain clean and updated books
Use digital tools for verification and filing
Monitor updates from CBDT and ICAI
With deadlines looming and penalties in place, timely compliance is essential. Businesses and professionals should act now to ensure smooth filing and avoid last-minute stress.