Taxation for Freelancers

Yes, it will be applicable only on the income you earned through freelancing. For Eg: If you earned 10lakhs through salary and 5 lakhs from freelancing then you can use 44ADA on that 5lakhs and can show taxable income as 12.5 lakhs (here am not considering any other deductions or exemptions that you may claim)
Best Part is that if you go by old tax regime you can get Chapter VI, i.e. Section 80 deductions also after applying 44ADA
 

arjungoyal12

KF Mentor
Yes, it will be applicable only on the income you earned through freelancing. For Eg: If you earned 10lakhs through salary and 5 lakhs from freelancing then you can use 44ADA on that 5lakhs and can show taxable income as 12.5 lakhs (here am not considering any other deductions or exemptions that you may claim)
Best Part is that if you go by old tax regime you can get Chapter VI, i.e. Section 80 deductions also after applying 44ADA
Are you a freelancer as well?
 

CAKaushik

KF Rookie
freelancing
You are required to pay tax, if freelancing income is not your primary source of income then it is to be included in head "Income from Other Sources" and will be taxed at normal slab rates. You can also claim any genuine expenditure which you have incurred to earn that income against that income in the same head.
If freelancing is your primary source of income and constitutes a substantial amount that it is better to consider that income in head "Profits & Gains of Business and profession" instead of "Income from Other Sources"
 

Hema Kulkarni

KF Mentor
You are required to pay tax, if freelancing income is not your primary source of income then it is to be included in head "Income from Other Sources" and will be taxed at normal slab rates. You can also claim any genuine expenditure which you have incurred to earn that income against that income in the same head.
If freelancing is your primary source of income and constitutes a substantial amount that it is better to consider that income in head "Profits & Gains of Business and profession" instead of "Income from Other Sources"
Thank you for this. This puts things in perspective.

Will have to figure out my strategy to best optimise for tax planning
 
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