Hello Friends,
I am new member and after reading through several articles, I am convinced that my soul searching for a good forum since last couple of months have ended.
I request some of the experts to please help me with the below queries. I haven't tasted big financial success as yet, but would earnestly like to be in the right side of the fence.
To begin with , I quit my regular job last year to work as a freelancer doing small jobs like data entry, webresearch etc for foreign clients (mainly USA). This is only my source of income.
1) Is there any special set of rules for Income Tax slabs or rates etc as my source of income is foreign related OR it would be very much as per any regular Indian rules?
Please elabaroate on this and the required 'clause' provided in IT books/website etc. I am very much confused by various theories.
a) Some people advised that it would fall under clause 10A/ 10B which means I have to pay 10% IT of my net taxable income. This is a new rule. Earlier all income from foreign source was exempted from tax.
b) Some people advised since I am a resident Indian, no matter from where the Income comes, as long as the tax is not deducted from source, you have to pay tax as per any regular Indian. i.e 10-20-30% slab.
c) There are yet others, who still maintain, all foreign income are fully exempted.
2) I have just about 20-25 transcations to show as 97% of my income was from a single source (client). All money transfers are through Bank and is very much legal.
Do I still need to maintain a detailed Books of Accounts by hiring an Accountant or a simple statement in Excel showing all my expenditures/income would suffice?
3) Can I file my returns electronically ? If yes, please help me with the link .
4) Do I have to use ITR-4 form ?(Income from profession/business). Please advise.
5) Could some of you please provide an authentic website / Books supported by the government for the above matter. I would like to enhance my knowledge as I am planning to expand in the coming years.
6) To reduce my tax liablity, Can I show the following expenses ? You may also please add some more valuable advice on this.
a) Money paid to my colleague who helped me to meet the deadlines (about 5000/- per month). Have not taken any Invoice or made him sign any voucher as yet.
b) I am working from home. The house is in my name. Any expenses related to the room, I am working? Electricty Bill ? Internet charges ? Etc
c) I am planning to buy a vehicle. Though not directly related to my business, any relief on this aspect.
I know I have posted a lengthy questions. But honestly, I am desperate, I have tried many experts in my rural town, however, either they are ignorant or making me more confused.
Thanks in advance
Regards
Vikas
CAclubindia
