TAX AUDIT
Introduction:
A tax audit is an examination into the background of tax related transaction to confirm that these are correctly calculated, paid and recorded. Since today’s dynamic environment both business and individuals have to conform with numerous taxation and other laws so a tax audit actually ensures compliance in order to minimise tax risk exposure to the client. The primary purpose of a tax audit is to make certain that books of Accounts have been maintained in agreement with the provisions of the Income Tax Ordinance 2001:
• Ensure that audit has effectively curbed Tax Evasion and ensures Tax Compliance.
• It enhances the reliance of stakeholders.
• Helps in improved tax planning.
How the audit proceedings are conducted?
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The proceedings of audit are conducted as follows:-
A. Record calling:
1. The Commissioner may, after recording reasons in writing and such reason shall be communicated to the taxpayer, call for the record or documents including books of accounts of the taxpayer.
2. The Commissioner may call for any record or documents including books of accounts maintained under this Ordinance or any there law for the time being in force for conducting audit of the income tax affairs.
3. If such record or documents have been kept on electronic data, the person shall allow access to the Commissioner or the officer (authorized by the Commissioner) for use of machine and software on which such data is kept.
4. The Commissioner or the officer may have access to the required information and data and duly attested hard copies of such information or data for the purpose of investigation and proceedings under this Ordinance in respect of such person or any other person.
5. The Commissioner shall not call for record or documents of the taxpayer after expiry of (six years) from the end of the tax year to which they relate.
B. Conduct an Audit:
1. After obtaining the record of a person or where necessary record is not maintained, the Commissioner shall conduct an audit of the income tax affairs (including examination of accounts and records, enquiry into expenditure, assets and liabilities) of that person or any other person and may call for such other information and documents as he may deem appropriate.
2. After completion of the audit the Commissioner may, if considered necessary, after obtaining taxpayer’s explanation on all the issues raised in the audit, amend the assessment under sub-section (1) or sub-section (4) of section 122, as the case may be.
How can Pakistan Business Consultants help you?
If you've received an audit notice, reach out to Pakistan Business Consultants and share a copy of the notice with us. Our representative will work closely with you, guiding you through the entire procedure and assisting in compiling the necessary records to comply with the notice. Our team at Pakistan Business Consultants can even represent you before the relevant authority to ensure smooth compliance, allowing
you to focus on your core business goals without any compliance hurdles
Trust Pakistan Business Consultants for comprehensive assistance throughout the compliance.
Contact us now! For free advisory and get a quote for your up to date compliance.
