How to File ITR for Authors, Artists, Musicians, Actors and Performers?

Filing Income Tax Returns (ITR) as an author, artist, musician, actor, or performer in India involves understanding your income sources, applicable tax forms, and eligible deductions. Here's a comprehensive guide to help you navigate the process:

Step-by-Step Guide to Filing ITR for Creative Professionals

1. Determine the Appropriate ITR Form

• ITR-3: Suitable for individuals earning income from a profession or business, including authors, musicians, and actors.

• ITR-4 (Sugam): Applicable if you opt for the Presumptive Taxation Scheme under Section 44ADA, which allows you to declare 50% of your gross receipts as income, provided your annual income is up to ₹75 lakh and cash receipts do not exceed 5% of total receipts.

2. Understand the Presumptive Taxation Scheme (Section 44ADA)

Under Section 44ADA, professionals with gross receipts up to ₹75 lakh (provided 95% of receipts are through recognized banking channels) can declare 50% of their receipts as income. This scheme simplifies taxation by eliminating the need to maintain detailed books of accounts. However, if you opt for this scheme, you cannot claim any further expenses as deductions. 

3. Gather Essential Documents

Ensure you have the following documents ready:

• Income Proof: Receipts from sales, performances, royalties, or any other artistic endeavors.

• Bank Statements: For all accounts to demonstrate financial transactions.

• Expense Receipts: For studio rent, art supplies, transportation, promotion, etc., which can be claimed as deductions if not opting for the presumptive scheme.

• Form 16/16A: TDS certificates issued by employers or clients.

• Form 26AS: A consolidated statement reflecting all taxes deducted against your PAN.

• GST Returns: If registered under GST.

• PAN and Aadhaar Cards: Mandatory for filing.

• Proof of Tax Payment: If advance tax has been paid.

4. Calculate Total Income and Eligible Deductions

• Sum up all sources of income.

• Deduct eligible expenses related to your profession if not opting for the presumptive scheme.

• Claim deductions under sections like 80C (investments), 80D (health insurance), 80G (donations), etc.

5. File the Return Online

• Visit the Income Tax e-Filing Portal.

• Register or log in to your account.

• Select the appropriate ITR form.

• Fill in the required details and upload necessary documents.

• Verify the return using Aadhaar OTP, EVC, or by sending a signed ITR-V to CPC, Bengaluru.

 Key Considerations

• Advance Tax: If your total tax liability exceeds ₹10,000, you are required to pay advance tax in four installments: 15th June, 15th September, 15th December, and 15th March.

• GST Compliance: If your annual turnover exceeds the GST threshold, ensure you are registered and comply with GST regulations.

• TDS on Professional Services: A 10% TDS is applicable on payments exceeding ₹30,000 for professional services.

✅ Final Tips

• Maintain Separate Accounts: Keep personal and professional finances separate for accurate record-keeping.

• Consult a Tax Professional: If you're unsure about any aspect, it's advisable to seek expert guidance.

• Stay Updated: Tax laws and forms may change; ensure you're using the latest versions and information.

If you need assistance with specific forms or further details, feel free to ask!