I have salary income in the form of pension from my previous empolyer. I am also self-employed.
What tax benefits can I avail - Standard Deduction for Salaried Person OR business expenses for Self Employed Person OR both based on quantum of income from each source. If I can avail only one of these, will that depend on which is the bigger source of income and can I change my status from year to year from salried to self employed and vice versa?
Your question is answered as under:
1. Pension Income: There is standard deduction available from this income. Hence, your whole pension income, as received by you, will be taxable without any standard deduction.
2. Income from Self Employment:
A) If in the nature of Profession: If the income you are earning is in the nature of Professional Services then you have to declare atleast 50 % of the Gross Receipts as your Income.
B) If in the nature of Business: If the income you are earning is in the nature of Professional Services then you have to declare atleast 8% of the Gross Receipts as your Income.
Hope this shall help.
Thank you.
Shaswat initial support private limited
Ahmedabad
CS
View Details
Sri Aurobindo Gnostic Centre of Education
New Delhi
CA
View Details
CAclubindia
