• ITR filing: Salary + professional income AY 18-19

Hi, I am Bibin from Mumbai.Below is the income&tax credit details for FY 17-18.

Salary(APR 17- Dec 17):
Total income (8-10): 519880
Tax payable: 16971
Tac paid: 17695

Proffesional Income (Dec17-Mar18):
Amount paid: 204000
TDS: 20400

My question is, Which ITR form I have to fill?. Can I use 44AD? Is tin number & expense details mandatory for avail 44Ad? I bought a computer for freelancing. Can I add that amount as expense while file ITR? I am living in a rented home. will I get any deduction on it? reply is much appreciated.

Bibin Thomas
Asked 5 years ago in Income Tax

Hi Bibin,

You can use 44ADA Opting for 50% as taxable income from freelencing. In that case, no further expenses will be allowed.

IT3 will be applicable in that case

If you want I can assist you in the same for return filling

Vidya Jain
CA, Kolkata
1008 Answers
58 Consultations

4.8 on 5.0

Hi

You cannot opt for 44AD. But 44ADA needs to be checked. What is the nature of your services provided? 44ADA provides for only eligible professionals wherein 50% of the gross receipts are considered as income and 50% as expense.

If opting for 44ADA, you can file ITR 4. Otherwise, ITR 3 needs to be filed.

We may help you with return filing.

Lakshita Bhandari
CA, Mumbai
5687 Answers
908 Consultations

5.0 on 5.0

Hii Bipin

Can you please explain which type of professional income you had earn from December to March.

Lalit Bansal
CA, Delhi
773 Answers
61 Consultations

5.0 on 5.0

Hi Bipin,

Hope you are doing well !

Can you please explain what kind of services are you provided?

If , you are providing eligible professional services covered u/s 44ADA then you can opt presumptive taxation scheme.You can file ITR 4.

Otherwise ITR 3 needs to be filled.

Thanks & Regards,

Payal Chhajed

Payal Chhajed
CA, Mumbai
5188 Answers
288 Consultations

5.0 on 5.0

As you recd both salary & professional income hence you have to file ITR4 (Saral) . As there is professional income form dec to march so you have to opt section 44ADA not 44Ad no need for TIN(GST) no as below 20lac. if opt 44 ADA then 50% will be assumed income no need to claim exp

Nitin Jain
CA, Jaipur
214 Answers

4.7 on 5.0

You may opt for section 44AD Presumptive taxation and the ITR form to be used is ITR-4 for AY 2018-19. Under section 44AD no expenses details are mandatory as you have to offer tax on presumptive income. So while offering 8% of gross receipts as income it is presumed that all the expenses are considered.

The computer you bought is a fixed asset for you and you may claim depreciation on it however it is not allowed as expenses to you. Rent expense cannot be claimed as deduction.

The profession you carry out needs to be specified to determine whether it falls under specified profession of section 44ADA or section 44AD.

Lookman Mansuri
CA, Vadodara
20 Answers

5.0 on 5.0

In your case 44ADA will be applicable where you 50% of gross receipts will treated as your income i.e 102000/- so there is no need to mention any expenses.

Till Dec17 you may check HRA allowance exemption with FORM 16 given by employer

Natasha Rajvaidya
CA, Bhopal
19 Answers

5.0 on 5.0

Dear Sir,

You are eligible for presumption taxation scheme u/s 44ADA.

Presumptive income to be offered higher of:

• 50% of the gross receipts from profession (OR)

• Income from profession

All deductions from sections 30 to 38 (including depreciation and un-absorbed depreciation / allowances) shall be deemed as allowed and no further deduction is allowed.

Warm Regards,

Karishma Chhajer

Karishma Chhajer
CA, Jodhpur
2450 Answers
29 Consultations

5.0 on 5.0

Hii,

1)You can use ITR-3 or ITR-4 I For filling Return of Income.

2) You can show your professional income under section 44ADA not under 44AD.

3) TIN or Expense details are not required to maintain for 44ADA.

4) You can not claim any Expense under section 44ADA, your income will be deemed 50% of Gross receipt.

5) You can claim Rent deduction under section 80GG or can claim HRA received from employer as exempt income.

Narendra Sonagra
CA, Ahmedabad
57 Answers

Not rated

your case is covered under section 44ADA

you have to disclosed minimum 50 % is your net profit from professional receipt and no need to maintain any books of account relating to professional income and expenses.

you can claim all expenses relating to professional fees upt to limit of 50 %

you have to file your income tax return under form no ITR-4 SUGAM

Bhadresh S Mevada
CA, Surat
49 Answers

Not rated

Hi

What is the nature of the service that you provide? If the service is covered under the professions mentioned under Sec 44ADA then 50% of the gross receipts are considered as income.You can file ITR 4.

You can get in touch for any further clarifications.

Regards,

Nikhil.

Nikhil Khanna
CA, Mumbai
1429 Answers
19 Consultations

4.8 on 5.0

Dear Bibin,

You cant opt for section 44AD as section 44AD is applicable only for businesses and not for profession. However, if you are into eligible profession, then you can opt for section 44ADA.

To know more about, section 44ADA, please find the link below:

https://www.incometaxindia.gov.in/tutorials/13.%20tax%20on%20presumptive%20basis%20in%20case%20of%20certain%20eligible%20businesses.pdf

If you dont fall under eligible professional's list, then you will have to file normal ITR 3. You can add depreciation @40% on the laptop in your expenses while filing itr. Deduction for rented home can be claimed under section 80G upto maximum 5k per month.

Abhishek Dugar
CA, Mumbai
3576 Answers
183 Consultations

4.8 on 5.0

You can opt for 44ada provided your services are included in list of specified services eligible for 44ada.If you opts for the same then no expenses can be claimed further.50% of your gross receipts will be deemed income and tax to be paid on the same.

Swati Agrawal
CA, Mumbai
1146 Answers
7 Consultations

5.0 on 5.0

Dear Bibin,

1) Regarding your professional Income, if you choose to file your return under sec.44AD a minimum of 50% should be shown as profit.

2) Tin Number/GST number is mandatory only if your Turnover/Professional Receipts are more than Rs.20Lakhs

3) Expense details are not mandatory to be shown. In case if books are maintained you can show the same.

4) Computer expense can be claimed as expense if it is used for business.

5) If HRA is claimed from your salary income, you can not claim any other deduction. If HRA is not claimed rent paid can be claimed under Sec.80GG.

Please contact me for further details or clarifications...

Praneeth Thunuguntla
CA, Guntur
56 Answers
1 Consultation

Not rated

Hi Bibin,

If you wish to avail benefit of 44AD you can file ITR-4.

If you are availing 44AD no other expense shall be allowed as dedution. you need to report minimum of 8% as Net profit.

So your Taxable Computation will be :

Income from Salary : 519880

Income from B&P

U/s 44AD : 40800

(Assuming profit of 20%)

Total Income : 5,60,680

Tax on Above Income: 25,375 (as per income tax slab including cess)

Total TDS : 38,095

Refund Due : 13,459

TIN is not mandatory.You can show cash & Bank bal. as actual and debtors can be shown as professional income receivable for the month of march(17,000) in ITR-4.

You can also reach us for more details.

Hope all your queries are resolved.

Siddhant Shah
CA, Mumbai
120 Answers
1 Consultation

5.0 on 5.0

Dear Sir,

Yes you can use ITR-4 and show income under 44AD.

Thanks

Vivek Kumar Arora
CA, Delhi
4825 Answers
1030 Consultations

5.0 on 5.0

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