ð Taxation for Freelancers, Consultants & Professionals ðŒ
The Income Tax Department has simplified taxation for small businesses and professionals by introducing specific sections for them. Let's discuss the details of the applicable sections for professionals:
Taxation for Professionals, Freelancers & Consultants (Section 44ADA) ð
If you are a freelancer, consultant, or a specified professional with gross receipts up to INR 50 Lakhs, you can offer your income at 50% of total receipts. For example, if an interior designer has total receipts of â¹35 Lakhs, they can declare â¹17.5 Lakhs as income in their ITR and pay tax accordingly.
Update from FY 2023-24:
- The limit of gross receipts has been increased from INR 50 Lakhs to INR 75 Lakhs if cash receipts do not exceed 5% of total receipts.
Specified Professionals Include:
- ð Legal
- ð¥ Medical
- ðïž Engineering or Architectural
- ð Accountancy
- ð ïž Technical Consultancy
- ð Interior Decoration
- ð Any other profession as notified by CBDT
