A tax audit under Section 44AB is a CA's review of your accounts, reported in Form 3CD (with 3CA/3CB). Here's when it applies for FY 2025-26.
Turnover and cash test
- Business: audit if turnover exceeds ₹1 crore — the limit rises to ₹10 crore if cash receipts and cash payments are each below 5% of the total (a largely digital business).
- Profession: audit if gross receipts exceed ₹50 lakh (the ₹10 crore relaxation doesn't apply).
Forms and dates
| Item | Detail |
|---|---|
| Audit report | 3CA/3CB + 3CD |
| Report due | 30 September 2026 |
| ITR (audit cases) | 31 October 2026 |
A trader has ₹6 crore turnover, with 99% of receipts and payments digital (under 5% cash).
Because the cash test is met, the ₹10 crore limit applies — so no tax audit despite crossing ₹1 crore. A near-identical trader doing 8% in cash would be above the 5% line → the ₹1 crore limit applies → audit required.
The 5% cash test is decided by your actual cash ratio, not your intention — one large cash deal can push you over. If you're between ₹1 and ₹10 crore, keep receipts and payments digital through the year to stay under audit; decide this in April, not next September.
Not sure how this applies to you?
Rules change and the answer depends on your exact numbers. Get a qualified professional to review whether a tax audit applies to you for your case — before you act.
Talk to a KyaTax expert →Frequently asked questions
Is my business liable for tax audit?
Depends on turnover, cash ratio, and any presumptive scheme. The ₹1cr/₹10cr/₹50L tests each have conditions — have a CA confirm.
Due date for FY 2025-26?
Audit report by 30 September 2026, ITR (audit) by 31 October 2026, unless extended.
Penalty for missing it?
Section 271B provides a penalty for failure to audit/furnish the report, subject to reasonable-cause relief. Seek help if at risk.
Related: Tax Audit Services · More guides · Our expert panel