Which is Better Option for Employee on Contract-PGBP or Other Source.png

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Whether Income to be shown as Other Sources or PGBP? Option 1 We show Other Sources and fill ITR 1 Full 600000 Taxable Option 2 We show PGBP income and fill ITR 4 We can claim 44AD or 44ADA Scheme Since he is Professional 600000*50%=300000 Income Tax Computation Particulars Option 1 Option 2 Annual Salary Less: Standard Deduction Income From Salaries PGBP Income Income from Other Sources Gross Total income Deduction Under Chapter VIA Net Total income Tax Rebate Net Tax Cess @ 4% Tax + Cess Less Annual TDS (5000*12 0 0 0 0 0 300000 0 600000 0 0 300000 600000 0 0 300000 600000 2500 32500 2500 0 0 32500 0 1300 0 33800 60000 60000 (Gross Receipts 50%) Monthly Salary 5 0000 TDS 5000 Net Salary 45000 Balance Tax/(Refund) (25200) (60000) Tax Planning for Professionals on Contract

About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 10 years. He also provides Accounts Tax GST Training in Delhi and Pune.