A job by day and freelance projects by night is the new normal, from developers on weekend contracts to teachers taking online classes. Come July, the question lands: how do both incomes fit in one return?
The form changes, the math is friendly
Salary plus professional income means ITR-1 no longer fits. The good news: you can use ITR-4 with presumptive taxation, declaring 50% of your freelance receipts as income under Section 44ADA while your salary is taxed normally alongside. Both incomes stack into one total, taxed at your slab.
A quick example
Neha earns Rs 12 lakh salary and billed Rs 4 lakh from freelance design. Under 44ADA her freelance taxable income is Rs 2 lakh, so her total is Rs 14 lakh. Her employer's TDS covered the salary, but nobody covered the freelance part, which is where advance tax enters if the extra liability crosses Rs 10,000.
Traps to avoid
- ✓Clients deduct 10% TDS on fees: claim every rupee via Form 26AS
- ✓Freelance income received in a savings account is still business income, and it shows in your AIS
- ✓Check your employment contract about moonlighting; that is between you and your employer, but the taxman just wants the income reported
Tell Saathi.Tax you have both salary and freelance income and the interview handles the rest: right form, presumptive computation, TDS credits and the regime comparison across your combined income.
