Master TDS & TCS Provisions with Critical Issues. Register Now!

I need know the tax implication of Presumptive income declaration

Ajesh (Accountant) (28 Points)

07 November 2019

I need to know the tax implication of below situation

I have annual salary income of 3 Lakhs. In addition to that I am doing freelance video editing service in the free time.i am serving video editing works through online marketing place which is stuated in United States. It is like a e commerce site which is used selling services. So am getting money from outside India. So I am getting around 5 Lakhs yearly as freelance income.

My doubt is can I declare the above mentioned freelance income as presumptive income Section 44 AD. Is there any implication for this. So that I can declare 6% of 5 Lakhs as income from business.

Any one please advise me

Reply
Follow
Share

6 Replies

Kapadia Pravin (17259 Points)
Replied 07 November 2019

I think video editing service may fall under specified Profession under Rule 6F of Section 44AA (3) and hence it will be 44ADA and not 44AD.

Under 44ADA you have to show minimum 50% or actual whichever is higher , as taxable income

Upgrade to CAclubindia Pro. Subscribe Now!

Ajesh (Accountant) (28 Points)
Replied 07 November 2019

Sir. Video editing meaning. I am providing freelance video editing work through online marketing place like e commerce site which is used for selling services. It is situated in United States. So income received from out side india.

Kapadia Pravin (17259 Points)
Replied 07 November 2019

@ Ajesh
You can definitely avoid tax by tax planning. But can not evade by resorting to other means.

It Will be either regular business/Professional income or under 44ADA.

rama krishnan (12239 Points)
Replied 08 November 2019

I think video editor in respect of a cinematograph film is included in the definition of film artist under rule 6F. so I think, you can opt 44AD

sabyasachi mukherjee (27609 Points)
Replied 08 November 2019

Ajesh
this is not called presumptive income.
This is incomes from business and profession .
Are u maintaining books of accounts which HAS TO BE basically audited by a qualified CA.

Upgrade to CAclubindia Pro. Subscribe Now!

Ajesh (Accountant) (28 Points)
Replied 08 November 2019

Sir,

Can you please explain . which categories of income falls under Presumptive income category in ITR ?. I have read in somewhere else this is fall under 44AD that why..