• Does a freelancer require a trade license

I am a freelance web content writer working from home, receiving writing assignments from an online marketplace named as http://upwork.com. Firstly, do I at all require any Trade License? 

Secondly, do I at all require any CA to audit my P/L and maintain a 'Book of Records' (my annual earning is less than 10 lakhs) and maintain a Current Account? 

Thirdly, what is the relevant Income Tax form that I should submit?

Thanks in advance.
Asked 1 year ago in Income Tax from Kolkata, West Bengal

No you dont require any trade licences.

For gross receipts of 10 lacs you dont require any audit. You can declare income u/s 44ADA.

You need to submit form ITR3

Vidya Jain
CA, Kolkata
639 Answers
15 Consultations

4.8 on 5.0


No trade license is required.

No. You can file income tax return under presumptive taxation scheme 44ADA.

Audit will be required if you show your net profits lower than 50% of the turnover.

Use ITR Form 3.

Lakshita Bhandari
CA, Mumbai
2254 Answers
81 Consultations

5.0 on 5.0


I don't think Trade License is required.

Audit is not required for your turnover. However, it is advisable to maintain books of accounts as it will give you a good idea about your business performance

Since your Turnover is below Rs. 50 Lakhs, you can declare 50% of your Turnover as Profit u/s 44ADA and file return in Form ITR 4

Pradeep Bhat
CA, Bengaluru
477 Answers
30 Consultations

5.0 on 5.0


As far as I know, you don't need trade license but I am not expert in this area.

No, you don't need to get your accounts audited as long as you are showing profit more than 50% of your sales.

You can submit itr 3 or 4 depending upon the type of work.

Please feel free to call/ revert in case you need more clarity.

Thanks and regards

Abhishek Dugar


Abhishek Dugar
CA, Mumbai
3576 Answers
162 Consultations

5.0 on 5.0


The trade license will depend on your state laws. So it is better if you consult a professional in your city, he will be in a better position to guide you.

If you feel you are competent enough to manage the accounts yourself then it is not mandatory at your level to appoint a CA or even an accountant. But it is advisable to appoint one as he will be in a position to help you as to which expenses you can claim and which you cannot. That will help you minimize your taxes.

Trust this clarifies your query.

Feel free to call / get back in case of further clarifications.

Thanking You.


Rohit R Sharma


Rohit R Sharma
CA, Mumbai
2104 Answers
91 Consultations

5.0 on 5.0

You don't need trade license to work as a freelancer.

As your income is less than Rs 20 Lakhs, you will be not covered under GST. You are also not covered under tax audit.You may declare 50% of your gross receipts as income, under presumptive taxation,if your activity is covered under specified professions.

B Vijaya Kumar
CA, Hyderabad
865 Answers
61 Consultations

5.0 on 5.0

Ask a Chartered Accountant

Get tax answers from top-rated CAs in 1 hour. It's quick, easy, and anonymous!
  Ask a CA