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Paypal and Indian Income Tax Queries

Discussion in 'PayPal' started by kdish, Mar 11, 2010.

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toughguy Well-Known Member

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#21

@mac83

If i am not wrong as per my knowledge there is some exemption for FREE LANCING or ONLINE EARNING, this is how web designing & some other companies get some tax rebates, in order to avail that i guess we need to provide proof earnings, source, etc.

if income crosses some limit then a registration need to be done with some department to avail more benefits.

I am unable to recall the information correctly, but i remember reading the stuff few years back on the Internet.

Correct me if iam WRONG..
Regards,
Leela

mac83 said: ↑

@Kdish:

Your Business Income: Rs.50000 + Rs.191000 (There is nothing callled freelance income as per I.T. law. It's yr business income)
Your Business Expenses: website&domain expenses + Paypal Charges + Internet Charges + (60% depreciation on your computer. Invoice required in yr name)

Gross Profit: Business Income - Business Expenses

If the above is greater then 1,60,000 then you will have to pay tax @10% on the amount greater 160000 and less than 3 lacs.

(If you have paid LIC premiums, Mediclaim or any other savings which fall under section 80C, you could get benefit of upto another 1 lac.)

All transactions of paypal are to be accounted. Not just withdrawal to indian bank account. For example, if you get $1000 for one project in paypal and you paid $200 for some advertising using paypal and withdrawn to bank remaining $800, then your income is $1000, your expenses is $200, and and foreign conversion charges by paypal are your expenses.
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toughguy, Mar 24, 2010 IP
theonly1 Active Member

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#22

toughguy said: ↑

@mac83

If i am not wrong as per my knowledge there is some exemption for FREE LANCING or ONLINE EARNING, this is how web designing & some other companies get some tax rebates, in order to avail that i guess we need to provide proof earnings, source, etc.

if income crosses some limit then a registration need to be done with some department to avail more benefits.

I am unable to recall the information correctly, but i remember reading the stuff few years back on the Internet.

Correct me if iam WRONG..
Regards,
Leela
Click to expand...

Yes,you are wrong.
No exemption for FREE LANCING or ONLINE EARNING.
Only exemption is available to Export units registered with STPI (Software tech. Park of India),where you can some tax rebate for 5 years.Not 100% through in any year.

theonly1, Mar 24, 2010 IP

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