Audit
[As per the Income Tax Act, 2025 (this Act) w.e.f. 1st April, 2026.]
Where the total income of a registered non-profit organisation, without giving effect to the provisions of this Part, exceeds the maximum amount which is not chargeable to income-tax in any tax year, the accounts of such registered non-profit organisation for that tax year shall be audited by an accountant and the person in receipt of the income shall be required to furnish a report of an audit of such income by such date in the prescribed form, duly signed and verified by such accountant and setting forth such particulars, as prescribed.
FAQs on Section 348 of Income Tax Act 2025
Who is required to get their accounts audited under Section 348?
A registered non-profit organisation whose total income exceeds the maximum amount not chargeable to income-tax in any tax year (before giving effect to the provisions of that Part) must get its accounts audited.
Does the audit requirement apply before or after claiming exemptions available to non-profits?
The audit requirement applies before giving effect to the exemptions or provisions of the relevant Part of the Act.
What is the due date for furnishing the audit report under Section 348?
The audit report must be furnished by the prescribed date, as specified in the rules made under the Act.
In what form should the audit report be submitted?
The audit report should be submitted in the prescribed form, duly signed and verified by the accountant, and must set forth the prescribed particulars.
Who can conduct the audit of a registered non-profit organisation under this section?
The audit must be conducted by an “accountant” as defined under the Act, who is eligible to carry out such audits.
What happens if a registered non-profit organisation fails to get audited as required?
Failure to comply with the audit requirement may lead to denial of certain benefits or exemptions and may also attract penalties under other provisions of the Act.
Does Section 348 apply to all registered non-profit organisations?
No, it applies only to those whose total income, before applying the provisions of the relevant Part, exceeds the maximum amount not chargeable to income-tax in a given tax year.
Is electronic submission of the audit report allowed?
Yes, the audit report must be submitted in the prescribed manner which includes electronic filing as per the rules under the Act.
Does Section 348 apply if the non-profit has no taxable income after exemptions?
Yes, if the total income before applying exemptions exceeds the basic exemption limit, audit under Section 348 is required regardless of the final tax liability.
Is the audit under Section 348 different from a statutory audit under other laws?
Yes, the audit under Section 348 is specifically for income-tax purposes and requires a report in the prescribed format as per the Income Tax Act, 2025.
