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Income Tax for Freelancers

BSahay (Service) (35 Points)

05 November 2009

My wife is in assignment as Freelance consultant to an overseas client. She gets consultancy fees remitted by bank transfer.

Please guide about Income tax implication on her consultancy fees.

Thanks

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CA.SKR (CA; CS-Final (One Group); DISA (ICAI); Insolvency Professional) (442 Points)
Replied 13 December 2009

Her income will be taxed under the head "Income From Business & Profession". She has to maintain Books of Account and has to make Balance Sheet and Profit & Loss Account every year. She has to pay tax on the net profit as per Profit & Loss A/c, which is to be adjusted as per Income Tax Act. All permissible deductions under Income Tax will be available.