Answer

ITR

Freelancer receipts in Form 26AS higher than ITR

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  1. Facts

    CPC compares the receipts on which TDS was deducted with the gross receipts in your return. A gap can come from timing, GST, or a client deducting on an advance. If all income is reported, you can disagree with a reconciliation.

  2. Provisions and law

    • Sec 143(1)(a) (now Sec 270(2))CPC can adjust the return for listed reasons, but must first tell you and consider a reply given within 30 days
    • Sec 44ADA (now Sec 58)Presumptive income of 50% of gross receipts for eligible professionals
    • Rule 37BA, Income-tax Rules 1962 (now Rule 203)TDS credit and matching follow the year in which the income is assessable

  3. Analysis

    Under Sec 44ADA (now Sec 58) your income is 50% of gross receipts, so a ₹2,00,000 gap in receipts means ₹1,00,000 more income if it is truly missing. Reconcile client by client: an advance received in March 2025 and taxed last year, or a client deducting TDS on an amount including GST, can explain the difference. If the reconciliation shows full reporting, Disagree and summarise it. If some receipts were missed, Agree for that part and consider the advance tax interest.

  4. Conclusion

    1. Download Form 26AS and list receipts by client.
    2. Match each with your invoices and bank credits.
    3. Disagree with a short reconciliation where the gap is timing or GST.
    4. Agree for any receipts genuinely left out.

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Proposed adjustment, Sec 143(1)(a) (now 270(2))

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