How much tax do freelancers have to pay? If you also earn from freelancing then know these rules
Highlights
- Income comes under the tax net
- TDS is deducted from the fees of freelancers
- The total amount of TDS is available in Form 26AS on the Income Tax Portal
Freelancers Tax Rule:In today’s time there are many opportunities for professionals to do freelance work. Many times people start freelancing along with their jobs. This removes the cost of the side. Whatever skills you have, you will definitely get offers to do freelance work from any corner of the world. came after corona Lockdown The trend of freelance has increased very rapidly among Today there are many freelancing opportunities in social media content writing, translation, web designing, software designing. If you are thinking of freelancing or are associated with freelancing, then you should understand the tax payable rate for that.
Income comes under the tax net
Let us tell you that the income you get through freelancing. It comes under the tax net. Freelancers have to file Income Tax Return (ITR-3 or ITR-4). As per the Income Tax Act, any earnings earned by demonstrating your intellectual or physical abilities are treated as earnings from a profession. This earning is taxed under the category “Profits from business or profession”.
TDS is deducted from the fees of freelancers
Most of the companies deduct TDS from the fees of the freelancers. Freelancers can claim TDS deducted while filing ITR (Income Tax Return). You can get information about TDS deducted from Form 26AS. The total amount of all TDS deducted by your employers is available in Form 26AS on the Income Tax Portal.
This is how tax liability is
Freelancers do not get the benefit of standard deduction of Rs 50,000 while filing ITR like normal salaried. However, if you have done regular job and freelance work in any financial year, then you can claim standard deduction on salary income. Also people with freelance income have to pay advance tax every quarter within the due date, when the net taxable amount is above Rs.10,000. If you calculate the total tax which is more than Rs.10,000, then you will have to pay interest thereon as per the Income Tax Law.
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