Chartered Accountants are the Best and Only Suited Professionals for Income Tax Audits, says ICAI President
ICAI President says only Chartered Accountants should do tax audits and calls for simpler tax rules and the use of technology in auditing
ICAI – CA – Income Tax Audits – Chartered Accountants – taxscan
ICAI – CA – Income Tax Audits – Chartered Accountants – taxscan
The 73rd President of the Institute of Chartered Accountants of India ( ICAI ), CA Charanjot Singh Nanda, has strongly stated that only Chartered Accountants (CAs) are qualified to conduct tax audits. He pointed out that tax audits require specialized knowledge and expertise, which only CAs possess due to their rigorous training in auditing, taxation, and financial regulations.
Why Chartered Accountants Should Conduct Tax Audits
In his message, CA Nanda explained that tax audits under Section 44AB of the Income Tax Act require in-depth knowledge and a high level of professional competence. Chartered Accountants undergo intensive education, practical training, and are governed by ICAI’s strict regulations, making them the most qualified professionals for the task.
He stated:
"Chartered Accountants, with their specialized qualification covering in-depth auditing framework and taxation laws, rigorous training, and deep expertise, are uniquely suited to conduct tax audits with the highest standards of quality and integrity"
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The ICAI President also expressed concerns about proposals that might allow other professionals, such as cost accountants or company secretaries, to perform tax audits. According to him, lawmakers have always trusted Chartered Accountants to handle tax audits, and this trust should not be compromised.
ICAI’s Role in Tax Reforms
The ICAI President also talked about the need to make tax laws simpler and reduce legal disputes. He explained that many tax rules are complicated and outdated, which often leads to confusion and unnecessary court cases. This creates problems for businesses and individuals, making it harder for them to follow the law. ICAI has been working closely with the Central Board of Direct Taxes (CBDT) and the Ministry of Finance to make sure the new Income-Tax Bill 2025 solves these problems. The goal is to create clear and fair tax rules so that businesses and taxpayers can follow them easily, reducing stress and delays.
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Some of ICAI’s key suggestions that were accepted in the Union Budget 2025 and the Income-Tax Bill 2025 include:
- Tax exemption on withdrawals from the National Savings Scheme (NSS) to reduce the burden on taxpayers.
- Changes in capital gains taxation to ensure fair tax treatment.
- Simplification of tax rules for small charitable trusts and institutions to reduce compliance difficulties.
- Increase in the TDS threshold under Section 194J for professional and technical services.
- Removal of TCS (Tax Collected at Source) under Section 206C(1H) to ease the burden on businesses.
- Updating outdated salary thresholds for tax on employee perks (perquisites).
ICAI has also recommended removing old and complicated provisions in the tax law, making tax deduction limits more reasonable, and ensuring tax rules are easy to follow. To ensure a smooth transition to the new Income-Tax Bill 2025, ICAI has formed seven expert groups across India to study the proposed changes and submit further recommendations to the government.
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The Importance of Chartered Accountants in Tax Audits
CA Nanda stressed that tax audits are essential to maintaining transparency, financial discipline, and accountability. If tax audits are not done properly, businesses and the economy could suffer. That’s why having only Chartered Accountants conduct tax audits is important.
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He explained:
“The recognition of Chartered Accountants as the sole experts in tax audit is crucial to maintaining the credibility of financial statements and reinforcing the trust of stakeholders in the taxation system”
ICAI will continue working with the government and tax authorities to ensure that CAs remain the only professionals allowed to conduct tax audits and that tax rules are practical and fair for taxpayers.
Using Technology to Improve Tax Audits
Technology is changing the way tax audits are done. The ICAI President explained that tools like artificial intelligence (AI) and data analytics can make tax audits faster and more accurate. ICAI is working on introducing digital tools and automated systems to help Chartered Accountants do their work better.
“For the year 2025-26, ICAI is set to drive transformational changes by integrating technology, promoting professional well-being, and strengthening global outreach. ICAI will focus on harnessing Artificial Intelligence, blockchain, and data analytics to enhance efficiency and accuracy in accounting and auditing”
He encouraged all CAs to learn new technologies to stay ahead in their profession. ICAI is also training its members in modern skills like forensic accounting, blockchain, and AI-based auditing. This will help Indian Chartered Accountants compete globally and continue to be leaders in financial reporting and tax audits.
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A Call for Professional Excellence
As he concluded his message, ICAI President CA Charanjot Singh Nanda encouraged Chartered Accountants to continue maintaining high ethical standards and professionalism. He reminded CAs of their responsibility toward the country’s financial system, saying:
"At every level of the economy, Chartered Accountants are India’s Catalyst for Advancement and Innovation. As financial soldiers of the nation, our profession’s contribution is significant in building a resilient economy and realizing our collective aspirations for a prosperous future"
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Quoting Mahatma Gandhi, he added:
"The best way to find yourself is to lose yourself in the service of others."
He urged Chartered Accountants to keep upgrading their knowledge, adapt to changes in technology and regulations, and contribute to the nation's economic growth.
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