Freelancer Presumptive Tax Calculator
Freelancer Presumptive Tax Calculator
44ADA presumptive vs actual-expense: which nets more?
44ADA presumptive taxable income
0
50% of gross receipts, deemed
Tax under presumptive scheme
0
no books, no audit, ITR-4
Tax under actual-expense basis
0
books required, ITR-3
The tradeoff beyond tax
Presumptive means no bookkeeping, no audit, and a simpler ITR-4 — genuinely worth something even at a similar tax bill. Actual-expense basis only wins clearly when your real expenses run meaningfully above 50% of receipts.
Section 44ADA lets professionals declare 50% of gross receipts as taxable income with no requirement to maintain books or get audited, up to a receipts threshold of ₹75 lakh if at least 95% of receipts come through banking/digital channels (₹50 lakh threshold otherwise). Tax is computed here on the new regime slabs (FY 2025-26/2026-27) with the Section 87A rebate applied if taxable income is at or below ₹12,00,000. This compares the two ELIGIBLE options (presumptive vs actual-expense) — it does not determine whether you qualify for 44ADA in the first place (specified professions only) or whether the old tax regime might do better with 80C/80D deductions layered in, which isn't modeled here. Not tax advice; confirm with a CA before filing.
Frequently asked questions
Should I choose the old tax regime or the new one?
It depends on how many deductions and exemptions you actually claim (80C, HRA, home loan interest, and similar). If your eligible deductions are substantial, the old regime often works out cheaper; if you claim few or none, the new regime's lower slab rates usually win. Compare both using your real numbers rather than assuming -- this calculator does that comparison directly.Read more: Rent in the City, Buy Farmland, Pay No Tax: The Advice That Raises Your Tax Bill
What counts as a tax-saving investment?
Under the old regime, Section 80C covers instruments like PPF, ELSS mutual funds, EPF, life insurance premiums, and 5-year tax-saving FDs, up to the annual 80C cap. The new regime doesn't offer most of these deductions, which is the core trade-off between the two regimes.Read more: Tax Deferment Techniques in India: What the Wealthy Use and Nobody Teaches You
How is capital gains tax calculated on mutual funds/stocks?
It depends on the holding period and asset type. Equity held over 12 months is taxed as long-term capital gains (with an annual exemption threshold); held less than 12 months, it's short-term and taxed differently. Debt funds follow their own, separate rules. Always check the current thresholds, since these are periodically revised.Read more: A ULIP Is an Investment Fund Wearing an Insurance Costume — Here’s Every Charge
What is TDS and when does it apply?
TDS (Tax Deducted at Source) is income tax deducted upfront by whoever pays you -- an employer, a bank paying FD interest above a threshold, and similar -- and deposited with the tax department on your behalf. It's an advance payment toward your total tax liability, not an extra tax, and is adjusted when you file your return.Read more: Rent in the City, Buy Farmland, Pay No Tax: The Advice That Raises Your Tax Bill
Estimates only, not financial advice. See our Disclaimer.
