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Missed december deadline for advance tax

Sandeep (Founder) (43 Points)

24 December 2014

I am late approx 10 days now from the 15th dec deadline. I had paid advance tax on time in September.

Can I calculate 1% interest per month on pro-rata basis and pay the advance tax installment now?

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32 Replies

CA ANKUSH AGGARWAL (CHARTERED ACCOUNTANT) (2782 Points)
Replied 24 December 2014

yes you can do so since 1% interest is calculated for per month on simple interest basis

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Sandeep (Founder) (43 Points)
Replied 24 December 2014

Thanks Ankush.

I have one more related query. This is my first year as a freelancer and expected turnover is more than Rs25Lakh. I have hired other freelancers and paying them using bank transfer (NEFT). Does getting an invoice from the hired freelancers in the attached format allows me to the payments as deductable cost from my earnings.

P.S. I do have a TAN number but haven't paid any TDS for hired freelancers till now.

Attached File : 1382808 1391926 aditya kumar.xlsx downloaded: 224 times

CA ANKUSH AGGARWAL (CHARTERED ACCOUNTANT) (2782 Points)
Replied 24 December 2014

As per my knowledge You would have to deduct TDS on payments made to Freelancers since freelancers are just like professional help.So deduct TDS us/s 194J.It is to mentioned that tds u/s 192 applicable for salary would not be covered here since there is no employee-employer relationship.You can claim payments made to freelancers as deductible expense provided you are not covered under presumprive business.

Sandeep (Founder) (43 Points)
Replied 24 December 2014

Originally posted by : ANKUSH AGGARWAL
	As per my knowledge You would have to deduct TDS on payments made to Freelancers since freelancers are just like professional help.So deduct TDS us/s 194J.It is to mentioned that tds u/s 192 applicable for salary would not be covered here since there is no employee-employer relationship.You can claim payments made to freelancers as deductible expense provided you are not covered under presumprive business.

But they haven't discolsed their income from other sources and I have paid them less than 2lakh this year. Still I need to deduct their TDS?

Mine is a android game development work. I earn from ads revenue on android. Earnings more than 25Lakh. Can I utilize section 44AD for presumptive business?

The link https://yourfinancebook.com/section-44ad-presumptive-income/

1) Mine is not brokerage or commission work

2) I am individual in computer software development

CA Raj Doshi (Practising CA) (8924 Points)
Replied 24 December 2014

You are a professional ( since you are computer programmer, software developer etc ). If your gross receipts are more than 25 lacs then you need to undertake tax audit from CA. Deduct TDS @ 10% if the payment to any freelancer during the year exceeds or is likely to exceed 30000 Rs. Limit for TDS is 30000 in case of payment to freelancers since it is professional or technical service. The limit of Rs.200000 does not apply.

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Sandeep (Founder) (43 Points)
Replied 24 December 2014

oh God! I didn't deduct TDS for so many freelancers and paid them in full.

I better see a CA in physical and get all this resolved. I have expenses from odesk.com, facebook ads, internet bills, fiverr.com, purchasing software, macbook, mobile phone.

If I contact a CA now, he will charge at least 15-20K from me now for resolving all the TDS and advance tax stuff right.

And then I need to pay 25-35K for account keeping and audit in April.

Could you pls advise if my estimates on the fees for CA are correct?

CA ANKUSH AGGARWAL (CHARTERED ACCOUNTANT) (2782 Points)
Replied 24 December 2014

Section 44AD is for retail business,since you are android game developer you dont fall under this category.

You have to deduct TDS since limit under section 194J is Rs 30,000 per annum as quoted by Raj C Joshi.TDS rate 10%.

An individual is liable to deduct TDS if he isrequired to get his accounts audited.(LImit of tax audit for professionals like software developer is RS 25 Lacs)

Disclosure of income under other sources is not required since you are not deducting TDS under salary income

CA ANKUSH AGGARWAL (CHARTERED ACCOUNTANT) (2782 Points)
Replied 24 December 2014

Sorry I cant help you regarding since I dont know anything about intensity of your operations,Natur e of expenses,Complications involved and how messy You have managed your accounting information.But If i have to say ,your estimate for book keeping is round about correct.

For tds and advance tax matter if you want I could do that at less than 15-20k,you can contact me at aggarwalankush0 @ gmail.com

Sahil Bhatia (Practicing Chartered Accountant) (290 Points)
Replied 24 December 2014

No tds shall be deducted if you were not liable for audit in the preceding year.https://www.lessmytax.com/persons-liable-to-deduct-tax-at-source-tds/ Now judging by your above replies you weren't liable for audit in the preceding year so you are not liable to deduct tds.

CA ANKUSH AGGARWAL (CHARTERED ACCOUNTANT) (2782 Points)
Replied 24 December 2014

Sahil is right....Tax audit limit is checked for preeceding year....

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Sahil Bhatia (Practicing Chartered Accountant) (290 Points)
Replied 24 December 2014

And about your doubt on TDS for professionals, if payment made to each freelancer is less than 30000 per bill or 75000 in total then you are not liable to deduct tds for that specific freelancer. For eg. If a freelancer bills you invoice of 29000 and further invoice of 28000 in the entire year then you are not liable to deduct any tds on that specific freelancer. Furthermore your estimates about CA fees are wrong, they will charge you 30k and do everything including advance tax tds and audit. For book keeping I recommend you to outsource the work as it will be cheaper.

CA ANKUSH AGGARWAL (CHARTERED ACCOUNTANT) (2782 Points)
Replied 24 December 2014

Sorry to mention sahil but I think you are wrong here.Check section 194J.If I m missing anything,kindly enlighten me

Sandeep (Founder) (43 Points)
Replied 25 December 2014

I am totally confused now :(

Lots of incoming information

I am in Gurgaon,Haryana. Anyone experienced tax consultant on CAClub from Gurgaon?

We can fix a meeting.

CA ANKUSH AGGARWAL (CHARTERED ACCOUNTANT) (2782 Points)
Replied 25 December 2014

Sandeep you dont have to be confused.Simply,You dont have to deduct tds if your gross receipts from your profession doesnot exceeds Rs 25 lakhs in year 2013-14.