The income earned by the individual is subject to tax. The tax levied on the income of a person is Income tax, which is levied and collected by the Central Government. Such tax on income earned is payable in the same financial year wherein it is accrued in the form of advance tax. But the intimation and calculation of the income as well the tax liability is provided in the Assessment Year. This intimation form is called Income Tax Return.

Freelancing income comes into the picture when you get hired to work on specific assignments for a specific term and get paid for the work upon completion and submission. A freelancer is not an employee of the company or placed on their payroll. Their gross income will be the aggregate of all receipts you get in the course of carrying out your profession. Their bank account statement is a document you can rely on to cull out this information, provided that they have received all their professional income through banking channels. The income tax form that freelancers need to fill out and submit is either ITR-3 or ITR-4. ITR-3 applies to income from business or profession. From AY 2017-18 (FY 2016-17), professionals can opt for presumptive taxation and declare 50% of their gross receipts as their income by filing ITR-4.