Income Tax is the total amount of tax to be paid by any individual to the Government and Income Tax Return is a statement showing the total income of any individual from various sources like salaries, business profits, etc. It also contains the details of deductions and other related facts about the income of the individual. It is compulsory for every individual to file the return and pay the required taxes regularly to the Government of India.
The Previous Year is the year for which the tax liability is calculated on the total income of that year, that is, if the tax is to be paid on the total income of the year 2018-19 then, 2018-19 will be considered as the previous year and 2019-20 will be considered as Assessment Year. The deadline maintained by the government is generally fixed after 4 months from the end of the previous year, providing enough time to the assesses to calculate the total income beforehand.
Many individuals think that it is ”smart” to save tax by not disclosing total income in the return. They think that it is worth saving a few rupees by tax evasion but it is not. Filing correct returns and paying exact taxes is the duty of every individual. Both are equally important.
The requirement of Filing Income Tax Return for a Freelancer/Blogger:
A freelancer is required to file an income tax return for AY 2019-20 if his total income crosses INR 2,50,000 annually. Your income should be more than this limit after all the deductions and exemptions. This income is called taxable income. Now let’s see the steps in calculating the taxable income:
Income-Tax Filing Forms:
The freelancer has to file the form ITR 4S for filing the return to the government. If your turnover crosses INR 1 Crore than you have to get your books audited before filing the return. The freelancers are not required to keep the accounts recorder under the Presumptive Taxation method.
Presumptive Taxation Method:
Under this method, the income is assumpted rather than calculated on the basis of accounts. To avail the benefits of this method, the freelancer is required to keep the records regularly for 5 years under Section 44ADA, after that he can use this method to file the returns. Freelancers should opt for this method as it has various advantages.
Advantages of ITR 4S:
Form ITR 4S is better than the previous form ITR 4. It has many benefits over ITR 4 like no need to file longer forms, no need to keep records, no need to get books audited, etc. Additionally, the rate of estimation of income is minimum in PTM. A minimum of 8% can be used after the calculation of income. You can increase the rate if you are earning more than it.
Professional Help Required:
The process of filing the returns online has reduced the time consumption in a lot of ways. Now you can get the refunds online within 7-10 days. All this is possible as the I-T Department now uses electronic Aadhaar based ITR verification system. You should always file the return before the due date to get refunds readily.
If you need the help of experienced professionals to file the income tax returns via Gen IT software and further assistance, you can contact SAG Infotech for the same. Contact us at email@example.com or give us a line at 0141-4072000 and we will try our best to assist you.