Income Tax: Professional fees is not salary; use ITR-4 to file return u/s 44ADA

Published: June 20, 2018 1:03 AM

TDS is being deducted under Section 194 J which clearly shows that professional services are being rendered by one to the company and you are not working as an employee of the company.

I am 66 years old and working as a consultant. My salary is paid to me as professional fees which does not exceed `50 lakh per financial year. TDS at the rate of 10% is deducted by the company. Can I file the return under Section 44ADA of Income Tax Act, i.e., on presumptive basis?
– Deepak Kumar
Yes, you can file the return under Section 44ADA of the Income Tax Act and file through Form ITR-4. The fees being received by you from the company is in the nature of professional fees and not salary. Also, your TDS is being deducted under Section 194 J which clearly shows that professional services are being rendered by you to the company and you are not working as an employee of the company. Thus, you can file return under Section 44ADA as it covers the professionals carrying on the profession of accountancy and consultancy.

My salary comes from outside India from my employer located in the US. It directly sends my salary into my savings account. Please advise as to which income tax form should I file towards return for 2018-2019.
—Pritam Singh
As per our understanding, you are rendering services in India for your employer in US which essentially is in the nature of salary only and your residential status is ordinary resident. Thus, you will be required to file your income tax return in ITR Form-1.

As a state government employee, I contribute to National Pension Scheme. Please clarify whether NPS deduction can be availed automatically under additional 80CCD(1B) for 50,000?
—Arnab Sharma
As per Section 80CCD of the Income Tax Act (Act), an assessee is eligible to claim deduction for the amount invested in National Pension Scheme (NPS) as notified by the Central Government. Finance Act, 2015 introduced an additional deduction of Rs 50,000 for the amount invested in NPS under Section 80CCD(1B) of the Act, which implies that now you can claim total deduction of `2,00,000 under Section 80C and 80CCD. Therefore, you are eligible to claim deduction of additional `50,000 under Section 80CCD(1B).

Amit Trivedi

The writer is partner, Ashok Maheshwary &
Associates LLP. Send your queries to
fepersonalfinance@expressindia.com

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