There is a slight difference between freelancer and consultants.
A freelancer is someone who does not work under someone for a long period of time, in technical terms he/she is his own boss.
Some freelancers work independently and some take clients or a company or a temporary agency but not for a long time.
There is a minor difference between freelancers and consultants in relation to income tax rules.
A person who is working as a freelancer cannot use some of the things which a salaried person can do.
Freelancers are allowed to get when they are working on a tenure for the company.
In the income tax rates, they are same for both freelancer as well as consultants.
5 points which will explain the income tax rules for a freelancer a little bit better:
- They cannot claim a certain amount of deduction which salaried individuals can do.
- Deductions under some Sections like 80C, 80CCD, 80D, 80TTA etc are only provided to individuals working as a consultant or a freelancer.
- Consultants can claim money for the shortest portion as well but freelancers cant.
- Freelancers cannot claim any personal expenses but consultants can claim money related to work expenditure.
- Income as a consultant is taxed under the head “Profits and Business or Profession” but not in the case of freelancers.
Check all Recent News Updates Here