Taxation under 44ADA of Income Tax Act and how you can use it to save a considerable amount of taxes.

A Chartered Accountant shares his dissection of one of the most important section of Income tax act applicable on remote workers and freelancers.

Why you should be reading this?

As a professional( including remote worker and freelancer), it is likely that your taxable income during the year exceeds Rs. 5 lakhs, which will require you to pay taxes on your income.

For those new to the working force of India, first of all congratulations, I wish for your economic prosperity and professional success. Secondly, income tax , in simple words, is the amount you pay to government out of and on the basis of your total income during the year.

The tax portion is significant for most individuals and hence, the need felt to reduce it is only natural. Managing your taxes under any law requires that you or your tax advisor(Read: CA/Lawyer) has ind-depth knowledge of the law, to plan out the taxes.

How is this blog-post structured:

The aim of this blog post is to provide comprehensive information on section 44ADA of the Income Tax Act. The post is written on the basis of assumption that the variety or reader reading this post will have variety of expectations and thirst for knowledge, hence the same is divided into various parts, and the readers can skip to the relevant part as per their interest.

Here is the index:

1. Section 44ADA- extract from income tax act

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1. Extract of 44ADA:

The section states the following, :

An assessee who is a resident of India and is

• An individual or a partnership firm(but not LLP)

• And is engaged in professions referred to in Section 44AA(1)(Which includes IT consultancy) and

• whose gross total receipts do not exceed:

  1. 75 lakhs or

  2. 50 lakhs, is the assessee received more than 5% of his gross receipts in cash.

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• Monochromatic color schemes use different shades and tints of a single color. This can create a cohesive and harmonious look.

• Analogous color schemes use colors that are next to each other on the color wheel. This creates a cohesive and harmonious look, as the colors share common undertones.

• Complementary color schemes use colors that are opposite each other on the color wheel. This creates a bold and vibrant look, as the colors create high contrast.

• Triadic color schemes use colors that are evenly spaced around the color wheel. This creates a balanced and harmonious look.

Use color to create hierarchy

In design, hierarchy refers to the way in which elements are arranged in order of importance. You can use color to create hierarchy in your designs by using different colors to highlight important elements. For example, you can use a bold color to draw attention to a call-to-action button, or use a softer color to draw attention to less important elements.

Use color to create contrast

Contrast is an important aspect of design, as it helps to draw attention to specific elements and make them stand out. You can use color to create contrast in your designs by using complementary colors, or by using light and dark shades of the same color.

Use color to create unity

Unity refers to the way in which all the elements in a design work together to create a cohesive whole. You can use color to create unity in your designs by using a consistent color scheme throughout the design, or by using analogous or monochromatic color schemes.

In conclusion, the use of color in design is crucial to the success of a piece. By understanding the importance of color, and using it effectively in your designs, you can create designs that effectively