Hi,
I am working as an independent contractor for a client, as a freelancer not of an employee; however I work for only one client, the payments are received on almost the same date every month. The services that need to be performed are decided by the client. There have no allowances and perks except the monthly payout.
While filing ITR, should form 1 be used (income from salary) or form 4 (income from profession with 44ADA)?
Thanks in advance.
File ITR 4 ...
ITR 1 not eligible for freelancers...
Use business/profession, not salary.
You’re an independent contractor, so income is PGBP, not salary.
Which ITR
ITR-4 + 44ADA if you’re a specified professional (e.g., technical/IT consultancy). Limits: receipts ≤ ₹50L, or up to ₹75L if cash ≤5%. Deem 50% as income. No separate expense claims.
ITR-3 if you want to claim actual expenses and keep books.
Checks
Salary applies only with TDS u/s 192 + Form 16. Freelancer payments are 194J/194C with Form 16A.
Report gross receipts, match AIS/26AS.
Consider GST if turnover crosses threshold (services usually ₹20L; lower in special-category states).
Pay advance tax if due.
Thank you both for your replies.
You are welcome.
Chirag N Shah & Associates
Mumbai
CA Inter
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