Freelancing & Taxes: Do Students Need to File ITR?

Taxes are boring, but getting a refund is exciting. Many students leave money on the table because they don't understand TDS.

1. What is TDS?

Tax Deducted at Source. If a company pays you ₹20,000 for a freelance project, they might deduct 10% (₹2,000) and pay you ₹18,000. That ₹2,000 is sitting with the Govt in your name.

2. Do I Need to Pay Tax?

In India, if your total income is below ₹7 Lakhs (New Regime), you pay zero tax. But the TDS was already cut. How to get it back?

3. Filing ITR (Income Tax Return)

You must file an ITR to claim a refund. It's a simple form (ITR-1 or ITR-4).

• Benefit 1: You get the refund (cash in bank).
• Benefit 2: It serves as proof of income for future Visa or Loan applications.

4. Stipend vs. Salary

Scholarships are tax-free. Stipends for internships are generally taxable if they exceed the basic exemption limit (which they rarely do for students).

5. Freelance Income (Section 44ADA)

Freelancers can declare only 50% of their income as profit and pay tax on that. This is a huge benefit for coders, writers, and designers.

Action: Check your "Form 26AS" on the Income Tax portal to see how much TDS has been deducted in your name.