Can i claim for deductable expenses from my professional income

Sanjit (not applicable) (119 Points)

06 October 2011

I have been in employment as a lecturer until August 2011. After that i have decided to strike out on my own as a free lancer giving lectures on an hourly basis at colleges that wish to hire my services.

Query one

I do believe that next year i shall have to use ITR 4 for filing my returns as i have income from salary, income from other sources and income from profession - is this right?

Query two

As i am now a part time hourly paid lecturer can i claim deductions on expenses that are connected with the development and discharge of my professional activites? ...such as petrol expenses for own vehicular conveyance, trade related books and periodicals ? are there any more i can claim?

Query three

Do i have to mantain books of account for the above and do they have to be audited for integrity? What proof do i keep for the above expenses if theya re indeed allowable? Yes for all my TDS on my income I will request the various college authorities to issue me with Form 16A after the financial year

Thanks for any help on these issues

This is the first time i am not in salaried employment so please help me out and spell out things simply, patiently and understandably

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Can i claim for deductable expenses from my professional income

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Audit under 44AB will be applicable if your gross receipts from teaching profession will exceed 15 lakhs. Not 60 lakhs. 60 Lakhs is for business.

Maintenaing Books of Accounts under 44 AA is not compulsory in your case.

And 44 AD is not applicable for profession. so not to worry about 8% profit.

You can claim expenses like Petrol, depreciation on them, Depreciation on books and other stationary expenses etc...

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Originally posted by : CA. Deepak Narula
	Query 1 - Yes, u are right. Query 2 - Yes u can claim all those expenses which are related to discharging ur duty. Query 3 - Teaching profession is not a notified profession as per section 44AA. So the books are only to be audited if gross receipts exceeds60 Lakh. But it would be advisable to keep in record all the bills for expenses incurred by you for the profession. Also, from AY2011-12, assessee has to show 8% income on his gross receipts under section 44AD and pay tax according to the slabs. In this case no books of accounts are required to be maintained. But if you think that your actual income after incurring exepnses is below 8% of gross receipts then u have to maintain books of accounts and get them audited under section 44AB.

Originally posted by : CA. Deepak Narula
	I explained in point no. 3 that teaching is not a specified profession u/s 44AA, so it comes under business as per my view and section 44AD can be applied in this case as well.