Who is Required to Compulsory Maintain Books?

It is Compulsory for

1.Specified Professions

like Accountant/Interior Designers/Film artists/IT Professionals/Company Secretary/Doctor/CA etc

 

2.Other Professions and Business-

If turnover >10,00,000

or

PGBP Income >1,20,000

or both

in any of last 3 years

(In case of new business, where turnover is likely to exceed 1000000 or Total income Likely to Exceed 12000 during Current Year)

 

3.Incomes of Presumptive Business if they claim ther income is  less than Specified Amt mentioned in Section 44AD/44AE/44BB/44BBB

 (For example:- In Section 44AD, if a person claims that his income less than 8% turnover,then he has to compulsarily maintain accounts and get them audited

 

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What Books to be Maintained?

For Specified Professions having Gross Receipts >150000 in any of last 3 years

((In case of new business, where Gross Receipts is likely to exceed 150000 during Current Year)

Specified Books to be maintained like

(a)Cash book

(b)Journal 

(c)Ledger 

(d) Original bills for expenditure

(e)If expenditure up to Rs 50 then payment vouchers

(f)Sales bills / invoices / receipt issued of amount >Rs 25.

 

In addition, Doctors have also to maintain

(g)Daily case register (mentioning detail is of patient handled daily) .

(h) Opening and closing stock register of Drugs/Medicines and Other Consumables

 

Such Books to be maintained for 6 Years.

The records can be maintained at different places also if profession is carried out at different places.

 

In All Other Cases

Such books which enable A.O. to Complete Total Income

  SUMMARY

Section 44AA Compulsory Maintenance of Books - Compulsory Maintenance of Books and Audit

44aa-business-new.png

 

 

 Important Points

  • Books to be maintained at the Principal Place of Business or Profession
  • If doing business or profession from more than one premises,can maintain books at different places also
  • Books Required to be kept for period of 6 years from end of Assessment Year

For Example

Financial Year 2015-16,Assessment year is 2016-17

End of Assessment Year is 31 March 2017

Records to be maintained till 6 years from 31 March 2017 i,e 31 March 2023

 

Penalty for Non Maintenance of Books 

In case, Books of Accounts not prepared or not maintained for prescribed period, then Penalty of 25000 p.a u/s 271A 

 

 

 

  1. Income Tax
  2. PGBP Income
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Davneet Singh
Davneet Singh is a graduate from Indian Institute of Technology, Kanpur. He has been teaching from the past 8 years. He provides courses for Maths and Science at Teachoo. You can check his NCERT Solutions from Class 6 to 12.