Future Generali

At what frequency is a freelancer required to deposit tax with the government?

Freelancers are individuals in the workforce that are self-employed and are hired by companies to work on a project-by-project basis. Examples include photographers, content writers, models, consultants, etc. Due to the nature of their work, i.e., being variable in terms of volume, and as a result, having a variable income, the tax payments that are needed to be made for freelance workers is dissimilar to that of ordinary salaried workers.

Freelancers, self-employed workers, businessmen, and corporations are required to pay something known as an ‘advance tax’. Since income for the aforementioned list of types of workers and corporations can vary, the government collects taxes from them quarterly. The ‘advance tax’ is also known as the ‘pay-as-you-earn tax’. So how does it work for a freelance worker?

If it is found that the total tax liability that a freelancer owes for the financial year exceeds the sum of ₹10,000, then the taxpayer is required to pay off his/her due amount in 4 quarterly instalments, as follows –

On or before June 15th Not less than 15% of advance tax
On or before 15th September Not less than 45% of advance tax as reduced by the tax paid in the last instalment
On or before 15th December Not less than 75% of advance tax as reduced by tax paid till the last instalments
On or before 15th March The whole amount (100%) of advance tax as reduced by the tax paid till the last instalments

If the taxpayer fails to make a payment, then the authorities can charge interest on the sum due.


How does one calculate their advance tax? A freelance worker is required to add up all the receipts of their income for the year and subtract from it all expenses related to work. For instance, if a software developer is working freelance, he/she can claim money spent on software, electricity, internet as work expenses. Work expenses are subtracted from income to arrive at taxable income. Income from sources other than work is also added.

So, in essence, if you are a freelance worker, you would be required to make four tax payments over the financial year, as opposed to the single payment that salaried employees make.

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