Answer

ITR

Indian clients deducting TDS from freelance fees

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  1. Facts

    Indian clients deduct TDS on professional fees under Sec 194J (now Sec 393). The TDS appears in Form 26AS (now Form 168) and is claimed in your return against the tax on your Sec 44ADA income.

  2. Provisions and law

    • Sec 194J, Income-tax Act 1961 (now Sec 393, Income-tax Act 2025)TDS on fees for professional or technical services
    • Sec 44ADA, Income-tax Act 1961 (now Sec 58, Income-tax Act 2025)Resident professionals with receipts up to ₹50 lakh (₹75 lakh if cash receipts are within 5%) can declare 50% of receipts as income

  3. Analysis

    Example: Indian receipts ₹6 lakh with ₹60,000 TDS and foreign receipts ₹14 lakh, total ₹20 lakh, so income is ₹10 lakh and tax is nil after the new regime rebate. The full ₹60,000 TDS comes back as a refund. Report gross Indian fees, not the net amount received.

  4. Conclusion

    1. Match Form 26AS (now Form 168) with your invoices
    2. Report gross fees from Indian clients
    3. Claim the TDS in the return
    4. Track the refund

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Freelancer return with foreign clients, Sec 44ADA

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