CBDT Extends Income Tax Audit Report Filing Deadline for FY 2024-25 to October 31, 2025

CBDT Extends Due Date for Filing Income Tax Audit Report for FY 2024-25 to October 31, 2025 

Introduction

The Central Board of Direct Taxes (CBDT) has announced an important update for taxpayers and businesses across India. The due date for filing the Income Tax Audit Report (ITAR) for the Financial Year 2024-25 has been extended from September 30, 2025, to October 31, 2025.

This extension comes as a relief for businesses, professionals, and taxpayers who face challenges in meeting the stringent timelines due to complex accounting, documentation requirements, and coordination with Chartered Accountants (CAs).

In this blog, we will cover:

Who is required to file the Income Tax Audit Report

1. Reasons for the deadline extension
2. Implications of the extension
3. Step-by-step guidance for compliance
4. Common mistakes to avoid
5. FAQs to help taxpayers

 

What is Income Tax Audit?

An Income Tax Audit is a statutory requirement under Section 44AB of the Income Tax Act, 1961. It applies to certain taxpayers whose turnover, gross receipts, or professional income exceeds the prescribed limits.

The audit is conducted by a Chartered Accountant (CA), who examines the taxpayer’s books of accounts and provides a detailed report on compliance.

The purpose of the audit is to ensure:

Proper maintenance of accounts
Accuracy of reported income
Compliance with the provisions of the Income Tax Act

Detection and prevention of tax evasion

Who Needs to File the Income Tax Audit Report?

Not every taxpayer is required to undergo an audit. The requirements generally include:

Business Entities:

Businesses with turnover exceeding ₹1 crore (or ₹10 crore if certain conditions are met for digital transactions).

Entities under the presumptive taxation scheme with turnover exceeding the prescribed limits.

Professionals:

Professionals earning gross receipts exceeding ₹50 lakh in a financial year.

1. Other Specific Cases:
• Taxpayers claiming deductions under specific sections or engaging in international transactions may also need an audit report.

It is crucial to determine eligibility early to avoid penalties for non-compliance.

Original Deadline vs Extended Deadline

Previously, the due date for filing the Income Tax Audit Report for FY 2024-25 was September 30, 2025. However, recognizing the practical challenges faced by taxpayers and CAs, the CBDT has extended the deadline to October 31, 2025.

This extension provides:

• Extra time for proper preparation of audit reports
• Coordination between taxpayers and auditors
• Correction of discrepancies before submission
• Avoidance of last-minute compliance stress

Reasons Behind the Deadline Extension

The CBDT often considers multiple factors before announcing deadline extensions:

1. Administrative Delays:
   The sheer volume of audits and filings can create bottlenecks in the system.
2. Complex Accounting Requirements:
   Many businesses have multiple sources of income, making audits detailed and time-consuming.
3. Technology and Documentation Challenges:
   While e-filing has streamlined processes, technical glitches and document reconciliation still require significant time.

Public Relief Measures:
Deadline extensions help taxpayers avoid penalties for genuine delays, supporting compliance without undue stress

Implications of the Extension

The extension has several practical implications for taxpayers:

1. Reduced Pressure:
   Taxpayers and CAs have an additional month to complete audits accurately.
2. Opportunity to Rectify Errors:
   If any discrepancies are found, there is more time to correct them before submission.
3. Avoiding Penalties:
   Non-filing after the extended deadline may attract penalties under Section 271B, which can include fines of 0.5% of turnover per month.
4. Impact on Tax Filing:
   Since the audit report is essential for filing income tax returns (ITR) for businesses, the extension indirectly allows more time for accurate tax filing.

Step-by-Step Guidance for Compliance

To ensure smooth compliance with the extended deadline, follow these steps:

Step 1: Determine Audit Requirement

• Check if your business or professional income exceeds the thresholds specified under Section 44AB.
• Review any special provisions applicable to your sector or transactions.

Step 2: Engage a Chartered Accountant (CA) Early

• Coordinate with a CA to begin audit preparations.
• Provide complete books of accounts, bank statements, invoices, and other documentation.

Step 3: Maintain Accurate Records

• Ensure all receipts, payments, and financial transactions are properly recorded.
• Reconcile bank statements with accounting records.

Step 4: Prepare the Audit Report

• Your CA will draft the Audit Report in Form 3CD and Form 3CB/3CA.
• Include all required disclosures as per the Income Tax Act.

Step 5: Review and Verify

• Carefully review the report before submission.
• Verify that all figures match your financial statements.

Step 6: File Online

• Submit the audit report via the Income Tax Department’s e-filing portal.
• Keep acknowledgement receipts for future reference.

Common Mistakes to Avoid

Even with an extended deadline, taxpayers often make mistakes that can lead to penalties:

1. Late Engagement of CA:
   Waiting until the last week of October may still lead to rushed filings.
2. Incomplete Documentation:
   Missing invoices, bills, or reconciliations can delay audits.
3. Ignoring Presumptive Income Rules:
   Businesses under presumptive schemes may incorrectly assume they don’t need audits.
4. Filing Errors:
   Mistakes in e-filing, such as incorrect PAN details or mismatch in figures, can result in notices.
5. Missing Other Compliance Requirements:
   Audit reports may also impact GST, TDS, and other statutory filings.

Penalties for Non-Compliance

If the Income Tax Audit Report is not filed by the extended deadline, the taxpayer is liable for penalties under Section 271B:

• 0.5% of total turnover or gross receipts per month of delay, subject to a maximum of 1.5 lakh INR.
• Repeated non-compliance may invite scrutiny and interest on unpaid taxes.

Filing on time, even with an extension, is therefore critical.

Impact on Income Tax Return (ITR) Filing

The Income Tax Audit Report is a prerequisite for filing certain ITR forms:

• ITR-3 for individuals and HUFs with business or professional income
• ITR-5 for firms, LLPs, and other entities
• ITR-6 for companies (other than those claiming exemption under section 11)

The extended audit deadline ensures that:

• Taxpayers can file accurate ITRs without errors
• Avoids notices or scrutiny due to mismatch in figures

Helps maintain proper compliance record with the tax department

How to Make the Most of the Extended Deadline

Taxpayers should use the extra month strategically:

1. Reconcile Accounts:
   Double-check all books of accounts, bank statements, and transaction records.
2. Seek Professional Advice:
   Consult a CA to optimise deductions, identify exemptions, and ensure compliance.
3. File Early:
   Don’t wait until the last day of October. Early filing reduces stress and avoids system overload.
4. Maintain Backup Records:
   Keep digital and physical copies of audit reports, bank statements, and invoices.
5. Check for Changes in Tax Rules:
   FY 2024-25 may have new amendments affecting audits and tax computation. Stay updated.

CBDT Notifications and Updates

The CBDT regularly issues circulars and notifications to update taxpayers about filing requirements, deadlines, and compliance rules.

• The extension for FY 2024-25 audit report filing was communicated through an official CBDT notification in September 2025.
• Such notifications are legally binding and should be closely monitored by all taxpayers and CAs.

FAQs

Q1: Who is eligible for the Income Tax Audit under Section 44AB?
A: Businesses with turnover exceeding ₹1 crore and professionals with gross receipts over ₹50 lakh are generally required to undergo audit.

Q2: What is the new deadline for filing the audit report for FY 2024-25?
A: The deadline has been extended to October 31, 2025 from the earlier date of September 30, 2025.

Q3: What if I fail to file the audit report by October 31, 2025?
A: Penalties under Section 271B will apply, including 0.5% of turnover per month, up to ₹1.5 lakh.

Q4: Can I file my ITR without filing the audit report?
A: No. For taxpayers required to submit the audit, ITR filing cannot be completed without Form 3CD/3CB/3CA submission.

Q5: Does the extension affect my tax payment deadlines?
A: No. The extension is only for audit report filing. Tax payment deadlines remain unchanged.

Conclusion

The CBDT’s extension of the Income Tax Audit Report filing deadline for FY 2024-25 to October 31, 2025 is a welcome relief for businesses and professionals. It provides extra time to reconcile accounts, prepare accurate reports, and avoid penalties.

Taxpayers are advised to engage their CAs early, maintain accurate records, and file reports well before the extended deadline to ensure compliance. Proper planning and adherence to the rules will reduce stress, avoid penalties, and maintain a smooth tax filing process.

With the right approach, businesses and professionals can leverage this extension to ensure accurate, timely, and compliant audit reporting for FY 2024-25.

“CBDT Extends Income Tax Audit Report Filing Deadline for FY 2024-25 to October 31, 2025”