Shreyaa Kapoor Instagram – If you are a professional working independently in the following fields:
Interior decorations, Technical consulting, Engineering, Accounting, Legal, Medical, Architecture, Movie artists include producers, editors, actors, directors, music directors, art directors, dance directors, cameramen, singers, lyricists, story writers, screenplay or dialogue writers and costume designers. 🙌🏼
Then section 44ADA is for you! 🌻
Professionals mentioned in the section can pay tax on their gross receipts under section 44ADA, and they can opt for this scheme only if their total income does not exceed Rs.75 lakhs.🙏🏼
This section reduces the tax liability by deeming 50% of gross receipts as profit. And you are still eligible to claim deductions like 80C, Medical insurance etc. 🙌🏼
A very important questions that self employed people have is how do we claim rent when we are given HRA anymore then note that under section 80GG – you can claim rent!🌱
For calculation – out of 15 Lakhs, under 44ADA you say your profits are 7.5 lakhs. Over and above this you claim 1.5L under 80C in ELSS or PPF, then 60,000 under 80GG for rent and medical insurance for 50,000 – bringing your income below 5 L. 🙌🏼
You can also opt for other tax deductions like education loan deduction, home loan deduction etc depending on your individual situation – I have made a detailed video on this a few weeks back! 🙌🏼
Once you get your taxable income down to 5lakhs – you get a tax rebate under 87A and hence pay 0 taxes!🌱
Feel free to drop your questions in the comments below and share this with your self employed friends!🫡
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[tax tips, tax season, tax saving, self employed, freelancer, taxes, rent, personal finance] | Posted on 14/Mar/2024 20:00:07
