IT Dept permits trusts, establishments to furnish the audit report for AY24 by March 31

Hospital, instructional establishments, trusts, funds, and many others, might want to file audit reviews for Evaluation Yr 2023-24 by March 31 to assert tax exemption, the Central Board of Direct Taxes (CBDT) stated on Tuesday. Earlier the due date was October 31. Failing to not submitting the audit report so will end in tax calls for, the board stated.

Any college, different instructional establishment, hospital, different medical establishment fund, establishment, belief or any belief or fund registered below part 10 and part 12AA of the Revenue Tax Act will get tax exemption topic to fulfilling sure situations. One of many situations — in case the whole earnings exceeds the utmost quantity which isn’t chargeable to income-tax in any earlier yr, the belief or establishment is required to get its accounts audited and furnish the audit report within the prescribed format earlier than the required date.

There are two varieties — 10B and 10BB. Earlier, based mostly on outdated or new tax regime, these varieties had been to be stuffed. Nonetheless, after an modification by Finance Act, 2023, a belief or establishments is required to fill Kind 10B in case its complete earnings exceeds ₹5 crore or if it has acquired any overseas contribution or if it has utilized any a part of its earnings exterior India. In all different circumstances Kind 10BB required to be stuffed. Initially these varieties for AY 24 had been to be stuffed on or by October 31, 2023.

Nonetheless, the board famous that in various circumstances trusts/establishments have furnished audit report in Form10B as towards 10BB and vice versa.  “Non-furnishing of audit report within the prescribed type would end in denial of exemption in such circumstances, because it is likely one of the situations which is required to be glad for declare of exemption. The denial of exemption on this account might end in creation of tax demand,” the Board stated. Now, all these trusts or establishments have been given time until March 31 to furnish the audit report within the relevant varieties.

Commenting on the most recent transfer, Amita Jivrajani, Director, Nangia Andersen India, stated overhauling the format of audit report and standards’s to furnish the identical resulted in widespread confusion amongst taxpayers, resulting in inadvertent submission of inaccurate audit reviews in Kind 10B as an alternative of Kind 10BB or vice versa. One of many potential issues stemming out of an incorrect choice of the audit report is the denial of exemption below Part 11 and Part 12 of the Revenue Tax Act, 1961.

“The CBDT’s resolution to permit entities to rectify audit reviews already submitted within the incorrect type vide this Round goals to streamline compliance for affected taxpayers and facilitate a clean transition to the brand new reporting necessities,” she stated.