If I am an independent software consultant with variable incomes and variable+multiple expenses. How do file my incomes and how would I be taxed?How are independent software consultants taxed on their income in India?I think, in your case, the second option will be the best suited because you are eligible to claim expenses such as rent, assistant salaries, travelling, books and periodicals, software development related expenses. Then, if you calculate your net profit, then the average tax rate will be around 10% and for that your already deducted TDS will be enough. If you are employed, directly tax will be deducted without allowing any expenses. Moreover, this work needs expert professional knowledge, you are eligible to claim your income under the head of Income from Profession.
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ThanksHow are independent software consultants taxed on their income in India?Section 28 to 44 of the IT Act 1961 dealt with business and/or professional Income.
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How are independent software consultants taxed on their income in India?Firstly you are professional - if your income in financial year crosses Rs.15lac in that case you should maintain all books of account and have a tax audit. If income below Rs.15Lac even in that case you should maintain books of account so that your income can be find out and pay tax but tax audit in not required.
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