Income Tax Audit: Deadline, key dates, penalties and other details explained

The deadline to submit an income tax audit is September 30, 2025, weeks after the due date to file an income tax return (ITR) for most people, Hindu Undivided Family (HUFs), and other entities not subject to audit.

Taxpayers with accounts that require audits, including companies, proprietorships, and partners in firms, must file their income tax returns for FY 2024-25 by October 31, 2025.

They must submit their audit report by September 30, 2025, before they can proceed. Currently, the Income Tax Department has not indicated any extension to the due date for tax audit.

What is a tax audit?

A tax audit involves examining a business or professional's financial records to verify compliance with the Income Tax Act. It is essentially a thorough review to ensure income, expenses, and deductions are correctly reported and that tax calculations are correct. The tax audit concerns income tax compliance and is required for certain taxpayers depending on their income or turnover.

Whose accounts have to be audited?

A taxpayer must undergo a tax audit if their business turnover or gross receipts exceed ₹1 crore in a financial year, or ₹10 crore if cash transactions account for less than 5% of total transactions, meaning cash receipts or payments do not exceed 5% of the total.

A tax audit is compulsory for professionals if their gross receipts exceed ₹50 lakh annually. Additionally, a taxpayer may be obligated to have their accounts audited under other specific circumstances.

What happens if a tax audit is not submitted before the deadline?

Not filing a tax audit report as required under Section 44AB can result in a penalty according to Section 271B of the Income Tax Act. This penalty is 0.5% of the total sales, turnover, or gross receipts, with a cap of ₹1,50,000. However, under Section 271B, no penalty will be levied if it is proven that there was reasonable cause for the failure, according to the Central Board of Direct Taxes.

Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. Taxpayers are advised to consult a qualified tax professional or refer to the official website of the Income Tax Department for accurate and up-to-date guidance before filing their returns.