Calculate TDS deductions on freelance payments under Section 194J and other applicable sections.
TDS (Tax Deducted at Source) is a mechanism where your client deducts a percentage of your payment and deposits it directly with the Income Tax Department on your behalf. As a freelancer, this amount is credited against your total tax liability for the year.
Under Section 194J, clients who pay you for professional or technical services must deduct TDS if the payment exceeds ₹30,000 in a financial year. The standard rate is 10% for professional services (design, consulting, legal, medical) and 2% for purely technical services.
The TDS deducted by your clients shows up in your Form 26AS and AIS. When you file your ITR, this amount is adjusted against your total tax liability — so you either pay the remaining tax or get a refund if TDS was more than your liability.
Always provide your PAN to clients. Without it, they are required to deduct TDS at 20%, which significantly reduces your cash flow even though you'll eventually get it back when filing returns.
Freelinq tracks TDS deductions per client, generates TDS-aware invoices, and gives you a tax summary at year end — ready for your CA or ITR filing.
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