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Tax on freelance income under the new regime

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Under Sec 44ADA, ₹24 lakh of receipts gives deemed income of ₹12 lakh. Under the new regime for AY 2026-27, the Sec 87A (now Sec 156) rebate covers tax where total income does not exceed ₹12 lakh.

Provisions

Sec 44ADA, Income-tax Act 1961 (now Sec 58, Income-tax Act 2025); Sec 87A, Income-tax Act 1961 (now Sec 156, Income-tax Act 2025); Sec 115BAC, Income-tax Act 1961 (now Sec 202, Income-tax Act 2025)

Analysis

Example: no other income, deemed income ₹12 lakh, tax before rebate ₹60,000, rebate ₹60,000, so tax is nil. With ₹26 lakh receipts, income is ₹13 lakh and tax is about ₹75,000 before cess, with marginal relief to check. A freelancer does not get the salary standard deduction. File the return even when tax is nil.

Close

  1. Compute 50% of receipts
  2. Add other income such as interest
  3. Apply new regime slabs and rebate
  4. Compare with old regime if you have deductions
  5. File the return

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Connect nowPay and start: Freelancer return with foreign clients, Sec 44ADA, ₹2,999

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