How to apply for GST and PAN for a Partnership Firm?

The 3 most important GST reminders for freelancers in India

The pandemic affects many more people. Working from home became a new norm for several companies, and the demand for freelancers is also on the rise as a result of this trend. Freelancers are not restricted to working for one company only, in fact, they are providing their services to a large number of companies.

When freelancers feel limited in the projects they work on, despite being well known for their ability to be flexible, the end result can be that they lose focus on their finances and they cannot pay attention to them adequately. A part of the work freelancers performs as independent contractors are the payment of GST, an essential part of the work they perform.

3 Things Freelancers Should Know about GST

This article will provide 3 major things regarding GST (Goods and Services Tax) for freelancers in India via a quick overview of the tax.

Limits for GST registration

A tax return for salaried employees does not have to be filed. As a freelancer, you may earn an income from freelancing services if you have a turnover of Rs. 20 lakh or more a year. You will need to pay 18% GST on any income you make from freelancing services if your turnover is Rs. 20 lakh or more. In the state of northeastern India, freelancers are required to pay GST if their annual turnover exceeds Rs 10 lakhs on a monthly basis (particularly in the northeastern states). It is mandatory for qualified freelancers to enroll under the GST system.

GST Enrollment

If freelance income does not fall within the GST ambit, there is no GST to pay. In this case, a freelancer can choose to register for GST instead of paying taxes.

“If a freelancer voluntarily registers for GST, it is his/her responsibility to comply with the provisions of the GST law in order to be able to do business safely. In addition, he/she will be required to comply with all of the related regulations, assemble the appropriate documents, and pay the applicable GST. In spite of this, he mentioned that voluntary registration could increase the burden of overall compliance, according to a tax expert.

The GST enrollment will not be beneficial to B2B customers as they will not be able to work with non-registered customers in the future. It is also important for freelancers to gain GST registration to reduce the input GST costs they may incur on procurements in the future, and that credit would then be available to them as credits at the end of the year.


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