How non-salaried professionals can navigate GST regime

Freelancers are required to pay 18% GST if their annual income exceeds ₹20 lakh, and need to follow GST compliance formalities

- MONIKA YADAV

IF you are a freelancer, or a professional offering your services for a fee, your income might be liable to an 18% GST if your annual income exceeds ₹20 lakh.

Professionals with an annual threshold above ₹20 lakh per annum like education consultants, architects, management consultants, CAs need to charge GST on their services, and then deposit the same to the government. However, certain professionals like doctors and individual lawyers do not need to pay GST.

"Employees of organisations receive salaries and are not subject to GST. Freelancers, who cross the threshold also need to pay GST and need to follow GST compliance formalities. Fees paid to independent directors are liable to GST, but the responsibility to comply is on reverse charge basis on the recipient organisation," said Saloni Roy, Partner, Deloitte India.

But paying an 18% GST and complying with GST rules could be both painful and cumbersome. Are there ways to reduce the GST burden? According to experts, there are ways to reduce tax burdens and navigate the GST landscape effectively. One option for eligible professionals is to consider the composition scheme.