ITR Filing: How is income from YouTube taxed? Here's all YouTubers need to know

YouTube Income ITR Filing: The deadline for filing Income Tax Returns (ITR) is July 31st. While many have already submitted their returns, many YouTubers are concerned about how to accurately file their ITR. They may also be uncertain about who is required to file and who is exempt. A lack of complete information can result in YouTubers being taxed more than necessary. If you're a YouTuber, here's a guide on which form you need to fill out and how to file your ITR.

How is ITR different for YouTubers?

As a YouTuber, your income is taxed differently from that of salaried individuals. You cannot use the ITR-1 or ITR-2 forms typically available to salaried taxpayers, nor can you claim the standard deduction of Rs 50,000, as your income doesn't qualify as salary. However, you can claim deductions based on your business expenses. Unlike salaried individuals, you cannot change your tax regime every year, so it's crucial to carefully consider which regime benefits you the most before making a decision.

Understanding Tax Slabs

The tax slabs for YouTubers are the same as those for salaried individuals; however, the deductions available may vary. Freelancers or consultants must file using the ITR-3 form. If you've opted for the presumptive taxation scheme, you should use the ITR-4 form, which is simpler and doesn't require detailed profit and loss statements or balance sheets. However, if your income exceeds Rs 50 lakh or if you want to carry forward losses, you must use the ITR-3 form.

How is YouTube income categorized?

The Income Tax Department categorizes YouTuber income based on the nature of the content. If you've registered a company, your income will be taxed as business income. Similarly, if your content is of a professional level requiring research or a team, it is considered business income. On the other hand, if you create content just for fun and earn from it, your income falls under "other sources."

What is the presumptive taxation scheme?

YouTubers, freelancers, and consultants can opt for the presumptive taxation scheme under Section 44ADA of the Income Tax Act, applicable to professionals earning up to Rs 75 lakh in the financial year 2023-24. Under this scheme, you can declare 50 per cent of your income as taxable business income. However, if you choose this scheme, you cannot claim any business-related deductions.

Key Deadlines

The last date for filing ITR for freelancers is also July 31st. However, if your business requires an audit under Section 44AB, the deadline extends to October 31st, with the tax audit report due by September 30th.