Freelancing- Presumptive Taxation

- Yes you can opt for presumptive taxation scheme u/s 44ADA. Income is taxable on accrued basis i.e. earned principle. You need to report the gross income and not net of expenses.

Dear Sir,

Hope you are doing well !!

Yes, you can take the benefit of presumptive taxation scheme u/s 44ada. Yes, it would be included.

A person who adopts the presumptive taxation scheme is deemed to have claimed all deduction of expenses. Any further claim of deduction is not allowed after declaring profit @ 50%.

Hi,

Considering you are opting for presumptive taxation, it is assumed that all the expenses have been considered while calculating the 6%/8%/50% profitability. 

Thus, you need to consider the gross amount (before deduction of upwork charges) as your income. For exchange rate purpose, you can consider the prevailing rates.

Yes you can file return under 44AD/ 44ADA presumptive taxation based on your service.

Its a platform fee that they are charging so its your expense but your turnover would be the gross amount before such deduction.

It has nothing to do with you not withdrawing the amount or you getting only net amount.

Even upwork would issue you an account which would show your gross amount and expenses charged by it.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you.

Hello,

Yes, you can opt for the presumptive taxation scheme.

Under the presumptive scheme, you are required to mention the gross receipts amount, i.e. without any deduction of expenses on an accrual basis. Therefore, you need to declare the gross income earned without deducting the membership fee. You can consider the prevailing rate for the conversion of foreign currency income.

I hope this answer satisfies your requirements.

Regards,

CA Hunny Badlani

The Upwork income will be included in your income. You can include 50% of income as taxable income under presumptive taxation. ITR 4 is to be filed for Freelancing income. If your taxes exceed 10000 in the entire Financial Year, advance tax is to be deposited.

Dear Sir,

Income Tax can be paid under the "Presumptive Taxation Method" in case of both Business and Profession. Presumptive Taxation Methods states 8% in case of business and 50% in case of profession, of the total turnover should be shown as taxable income and tax is to be paid thereon.

As mentioned by you, total amount of income will be considered as total turnover i.e the total earnings from upwork before deducting any expenses and tax should  be paid on the same 8% or 50% as the case may be.

Thanks and Regards 

Divya Chugh