Freelancing - income in foreign currency

1194 views 3 replies

I provide software services for foreign clients and receive payment in USD to my personal bank account.

Questions

  1. Do I need to pay Service Tax ?
  2. Do I need to get audited ? (My income is above 10 lakhs)
  3. Do I need to get IEC ?
  4. Are there any FEMA rules I need to be aware of?
  5. Will I come under section 44AD ? Will I come under section 44AD even if I establish a sole propietorship ?
  6. If I come under 44AD I need to pay just 8% of payments as tax ?

 

 

 

Replies (3)
Originally posted by : Manu


I provide software services for foreign clients and receive payment in USD to my personal bank account.

Questions


Do I need to pay Service Tax ?

That shall depend on palce of utilisation of services being provided by you.

Do I need to get audited ? (My income is above 10 lakhs)
NO, the benchmark of 15 lakh is on the receipts and not incme.

Do I need to get IEC ?
Answer shall depend on services being provided by you.


Are there any FEMA rules I need to be aware of?
Answer shall depend on services being provided by you.


Will I come under section 44AD ? Will I come under section 44AD even if I establish a sole propietorship ?
Answer shall depend on services being provided by you.


If I come under 44AD I need to pay just 8% of payments as tax ?
Yes, but the answer shall depend on services being provided by you.

 

 

 


Anuj

femaquery @ gmail.com

Thanks Anuj.

Type of service: Custom software (web applications) development. Say, building a social network web application like facebook.

Place of Utilization: United States (Not sure how to determine this, but the service is provided to a US based client and they own the software and Intellectual Property. The software is deployed on US & German servers)

I should clarify that the receipts exceed 10 Lakhs (not income). It will exceed 15 Lakhs in the current financial year.

Freelancing -service income in foreign currency 

I think no tax is required to be paid if service income is received in convertible foreign currency.

Correct?

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