Hello. My name is rahul. Recently i have started a job as a music composer for a studio based in USA. It's a remote job so i am working from home. It's not a salary based job instead i get paid on a hourly basis($25/hr), so my monthly income differs each month. My estimated total income would be around 28-30 lacs per annum. I want to know when do i need to pay the taxes.. Quarterly OR in a single installment. Do i need to register for GST? Please help md with this. Thank You.
- Threshold limit to obtain GST registration is Rs.20 lacs. It would be treated as export of services if you will receive consideration in convertible foreign exchange. Apply for LUT and export without payment of taxes but obtaining registration and filing of GST returns is mandatory.
- Under Income tax, pay advance tax on the estimated net profit and file ITR. ITR is an annual activity.
For detailed discussion you may opt for phone consultation.
1. You must register under GST because your aggregate turnover exceeds Rs. 20 Lakhs per annum. The type of service rendered by you falls under the export of services. You can apply for LUT after GST registration so that you will not be required to charge GST on your invoices from your client.
2. You can opt for QRMP - Quarterly Return Monthly Payment scheme under GST after registration. Under this scheme, the return is to be filed quarterly, but estimated tax liability must be paid monthly.
3. Under the Income Tax, you must file your Income Tax Return after the end of the financial year and pay taxes on your income. Your income from music composition will be charged under the head income from business/profession.
4. You can opt for a presumptive scheme u/s 44ADA while filing your Income Tax Return.
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For a detailed discussion, you can book a phone consultation.
Register in GST, Take LUT so no need to pay tax.
Income tax liability you need to pay advance tax on or before 15/06,15/09,15/12 & 15/03 as per the income receipt
Dear Sir,
Hope you are doing well !!
- You are compulsory required to obtain GST registration as your professional receipts exceeds INR 20 lacs during the FY (i.e. April - March).
-Services provided by you to US company will be treated as export of services which is treated as zero-rated services. You can export without payment of taxes if consideration would be received in convertible foreign exchange currency and apply for LUT before raising first invoice. Obtain FIRC from your bank all inward remittances.
-You need to pay advance tax on quarterly basis on the estimated net profit.
We may assist you with the entire process and compliances.
Hello Rahul,
Under GST, your services to the US-based studio would be covered under Export of Services if you are receiving convertible foreign currency as consideration. Export services are zero rated supplies. You can apply for LUT and supply such export services without payment of GST.
GST registration and return filing compliances would be mandatory since the total receipts would cross the Rs. 20 Lakhs limit.
Under Income Tax, the advance tax would have to be paid quarterly according to your net taxable income from the music composing business. Return filing would be required after the end of the concerned financial year.
I hope this answer satisfies your requirements. For a detailed resolution of your query, you can contact us directly at badlaniassociates at Gmail or take a phone consultation.
Regards,
CA Hunny Badlani
Badlani & Associates
Hello,
You need to register under GST once your turnover exceeds Rs. 20 Lakhs. This would be export of services if the consideration is received in foreign exchange. You need to obtain LUT. Please ask your bankers about FIRC as well.
You need to pay Income-tax as per advance tax instalments (quarterly) and file IT return annually.
We can assist you with these services. Do reach out for detailed consultation.
Hi
Yes, you need to register under GST once your turnover crosses 20 lacs.
You can opt for presumptive taxation scheme under 44ADA and pay the taxes by 15th March 23 for FY 22-23.
We may discuss the issues further and assist you with the compliance.
Dear Rahul,
In reference to your query, please note that taxes need to be paid by you on periodic quarterly basis. I am attaching herewith the Official link for computation for your ease.
https://www.incometaxindia.gov.in/pages/tools/advance-tax-calculator.aspx
In so far as GST is concerned, not only is your turnover exceeding the basic limit of INR 20 Lakhs but also you are providing export of services which is a compulsory registration activity. However, in case of export of services, the Government has provided a benefit in the form of LUT, by executing which you would not be required to pay any taxes. However please do note that filing of returns would be mandatory.
It is suggested that you should take this registration at the earliest, as also compute your annual income and pay the applicable advance tax as the due date for 1st instalment being 15th June is already past.
Please advise in case of any further clarification.
Thanks & Regards,
CA Aditya Dhanuka.
Income tax:
Yes you need to pay tax on your income. Payment of tax would depend on your nature of income and whether you opt for presumptive taxation or not.
GST:
Considering the above turnover GST registration needs to be taken. However you might not be required to pay any GST on same depending on full facts.
I would recommend you to have a call consultation for better discussion.
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Thank you
You need to pay advance tax on monthly basis. Since what you are doing is export of services so no GST will get levied but you need to take GST no & file your GST returns.
You need to offer your earnings from USA for Income Tax.
You also need to register under GST as your turnover exceeds Rs 20 Lakhs.
