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Business Standard
24-06-2025
- Business
- Business Standard
Earning from reels or brand deals? Here's how influencers must file ITR
From choreographed reels to brand shoutouts, India's growing tribe of digital influencers is turning social content into serious income. But as the money flows in from YouTube AdSense, affiliate links, Instagram collaborations and freebies, so does the tax department's scrutiny. With digital footprints becoming increasingly trackable, creators can no longer afford to ignore the tax implications of their online hustle. 'All income from reels, brand deals, affiliate links, and even barter collaborations, if total gifts exceed ~50,000 in a year, must be reported under 'business and professional income' in your ITR,' said Sudhir Kaushik, co-founder and chief executive officer of TaxSpanner. 'Even free gadgets or hotel stays count as taxable perks.' What you must report Unlike salaried employees, influencers are treated as self-employed professionals or business owners under tax laws. According to Ankit Jain, partner at a law firm, Ved Jain and Associates, 'Income from brand promotions, affiliate commissions, online workshops, event appearances, merchandise sales, or even foreign payments must be reported. Under Section 194R, brands offering free items worth over ~20,000 must deduct 10 per cent TDS on fair market value, this applies even if the influencer receives no cash.' Pallav Pradyumn Narang, partner at CNK & Associates LLP, an all-service firm, echoed this. 'Everything received in exchange for content, whether in cash, kind, crypto, or vouchers, falls under the taxable head of 'Income from Business or Profession',' Narang said. Deductions that lighten the tax load Influencers can reduce their taxable income by claiming relevant expenses. 'Costs like studio rent, internet bills, software tools, camera gear, or travel for brand shoots are deductible if used for business,' said Shefali Mundra, chartered accountant and tax expert at ClearTax. 'Even salaries paid to video editors or assistants can be claimed. For high-value items like laptops or lighting equipment, only depreciation is allowed under Section 32,' Mundra said. Jain recommended that creators 'maintain a separate business bank account to avoid mixing personal and professional expenses. This simplifies accounting and strengthens your defence in case of scrutiny.' ITR-3 or ITR-4? Choose wisely Not all influencers qualify for the presumptive taxation route. 'If your work involves skills listed under Section 44AA, like technical consultancy or film artistry, and your gross receipts are under ~75 lakh, you may opt for presumptive tax and file ITR-4,' explained Kaushik. 'Otherwise, you'll need to use ITR-3 and maintain proper books.' Savani added that content creators can choose between the old and new tax regimes based on which offers better deductions. Skip the guesswork -- be fully compliant Under-reporting income or choosing the wrong ITR form can backfire. 'AIS and Form 26AS already reflect what brands, platforms, and banks report to the tax department,' said Savani. 'Even minor mismatches can trigger notices, audits, and penalties up to 200 per cent of the tax due.' Mundra further warned that failing to pay advance tax can attract interest under Sections 234B and 234C. 'Foreign earnings, GST on sponsored posts, and high-value freebies are under the scanner. Don't wait for a notice, file cleanly and smartly.' Final word Being an influencer may feel fun and free-spirited, but when it comes to taxes, it's serious business. From the first brand deal to the last swipe-up link, every rupee (or ring light) counts. The Income Tax Department is watching your follower count and your Form 26AS, so file right, stay compliant, and keep creating without worry.
Yahoo
23-04-2025
- Business
- Yahoo
I'm retiring in my 30s and will still be a millionaire by 60. Here's how I'm using Coast FIRE to achieve my goal.
Elena Kodama plans to quit her software engineering job for a Coast FIRE lifestyle. Coast FIRE allows part-time work and financial independence through strategic savings. Kodama's reselling business and YouTube channel generate income to support her retirement plan. This as-told-to essay is based on a conversation with Elena Kodama, a 31-year-old software engineer in Cambridge, Massachusetts. It has been edited for length and clarity. I started my career in 2017 as a contractor and software engineer. I recently decided, at age 31, to soon quit my six-figure job as a software engineer to pursue a Coast FIRE lifestyle and spend more time with my family. I'm married and have two children. Saving aggressively in my 20s is what will allow me to do this. Coast FIRE is a version of financial independence combined with a retirement savings strategy. It's about easing up, stepping away from high-pressure careers, and living on your terms. With this method, you continue working part-time at a job you love. I first learned about it while attending the Rose-Hulman Institute of Technology. It's essential to learn about personal finance early and start saving so you can benefit from compound interest when time is on your side. Once I started working, I maxed out my Roth IRA and 401(k), saving about $100,000 in four years. Throughout my 20s, I saved and invested about $150,000 total. With the power of compounding at a conservative 5% annual growth rate, I only need to contribute around $12,000 a year for the next 30 years to reach over $1.5 million in retirement funds and fully retire in my 60s. In 2023, during my first 18-week maternity leave, I started a reselling side hustle, purchasing products on sale and selling them for a profit on Amazon. Finding the optimal product to sell is a lot of trial and error. In the beginning, I went into stores to find profitable products. After weeks of market research, I learned that you can get 50% ROI on a specific brand of shoes. Based on that, I niched down product categories and brands. Then, I would purchase sneakers online during sales and resell them on Amazon for full price. I use an app that provides data such as product sales estimates and the number of sellers. I was privileged to have plenty of help with my newborn, including a work-from-home husband, parents, and in-laws who would switch off babysitting. This allowed me to invest enough time to master this new side hustle. I scaled the business to over $200,000 in revenue within a year, with a net profit of $14,000. In 2024, I shared my reselling story on YouTube, and it went viral, gaining over 2 million views and 50,000 subscribers. This led me to join the YouTube Partner Program, where I create one to four videos a month and earn around $500 monthly from YouTube AdSense. Along with my reselling business, this generates enough income to cover living expenses and the $12,000 I contribute annually toward my retirement fund. I currently earn between $2,000 and $5,000 a month as an entrepreneur. My husband's 9-to-5 job covers our family's health insurance and mortgage. His income is in the low six figures, and he enjoys his job, so he isn't looking to retire early. I pay for all the other bills, like utilities and groceries. I've worked as a software engineer at Tulip Interfaces for almost four years and will officially leave when my maternity leave ends to embrace freedom and flexibility. I like my job but don't prefer working for a company. I want to work for myself at my leisure. I'm on my second maternity leave and focused on creating content and launching new side hustles while spending more time with my family. For me, retiring means having the freedom to do anything I want. I won't sit at home and do nothing as a retiree. My hobby is starting new businesses, learning, and sharing my knowledge. I'm focused on testing different businesses, such as an AI automation agency, and launching additional e-commerce businesses. My core business currently focuses on content creation from YouTube. Ultimately, I want to travel around the world with my family. Do you have a story to share about retiring early? Contact this editor at lhaas@ Read the original article on Business Insider Sign in to access your portfolio
Business Insider
23-04-2025
- Business
- Business Insider
I'm retiring from my tech job at 31. A Coast FIRE lifestyle and side hustles will make me a millionaire in my 60s.
This as-told-to essay is based on a conversation with Elena Kodama, a 31-year-old software engineer in Cambridge, Massachusetts. It has been edited for length and clarity. I started my career in 2017 as a contractor and software engineer. I recently decided, at age 31, to soon quit my six-figure job as a software engineer to pursue a Coast FIRE lifestyle and spend more time with my family. I'm married and have two children. Saving aggressively in my 20s is what will allow me to do this. With a Coast FIRE plan, I no longer have to work full-time Coast FIRE is a version of financial independence combined with a retirement savings strategy. It's about easing up, stepping away from high-pressure careers, and living on your terms. With this method, you continue working part-time at a job you love. I first learned about it while attending the Rose-Hulman Institute of Technology. It's essential to learn about personal finance early and start saving so you can benefit from compound interest when time is on your side. Once I started working, I maxed out my Roth IRA and 401(k), saving about $100,000 in four years. Throughout my 20s, I saved and invested about $150,000 total. With the power of compounding at a conservative 5% annual growth rate, I only need to contribute around $12,000 a year for the next 30 years to reach over $1.5 million in retirement funds and fully retire in my 60s. A side hustle will help me reach my yearly savings goal In 2023, during my first 18-week maternity leave, I started a reselling side hustle, purchasing products on sale and selling them for a profit on Amazon. Finding the optimal product to sell is a lot of trial and error. In the beginning, I went into stores to find profitable products. After weeks of market research, I learned that you can get 50% ROI on a specific brand of shoes. Based on that, I niched down product categories and brands. Then, I would purchase sneakers online during sales and resell them on Amazon for full price. I use an app that provides data such as product sales estimates and the number of sellers. I was privileged to have plenty of help with my newborn, including a work-from-home husband, parents, and in-laws who would switch off babysitting. This allowed me to invest enough time to master this new side hustle. I scaled the business to over $200,000 in revenue within a year, with a net profit of $14,000. My business has expanded to YouTube In 2024, I shared my reselling story on YouTube, and it went viral, gaining over 2 million views and 50,000 subscribers. This led me to join the YouTube Partner Program, where I create one to four videos a month and earn around $500 monthly from YouTube AdSense. Along with my reselling business, this generates enough income to cover living expenses and the $12,000 I contribute annually toward my retirement fund. I currently earn between $2,000 and $5,000 a month as an entrepreneur. My husband's 9-to-5 job covers our family's health insurance and mortgage. His income is in the low six figures, and he enjoys his job, so he isn't looking to retire early. I pay for all the other bills, like utilities and groceries. I plan to quit engineering for good this summer I've worked as a software engineer at Tulip Interfaces for almost four years and will officially leave when my maternity leave ends to embrace freedom and flexibility. I like my job but don't prefer working for a company. I want to work for myself at my leisure. I'm on my second maternity leave and focused on creating content and launching new side hustles while spending more time with my family. Early retirement will bring freedom For me, retiring means having the freedom to do anything I want. I won't sit at home and do nothing as a retiree. My hobby is starting new businesses, learning, and sharing my knowledge. I'm focused on testing different businesses, such as an AI automation agency, and launching additional e-commerce businesses. My core business currently focuses on content creation from YouTube. Ultimately, I want to travel around the world with my family. Do you have a story to share about retiring early? Contact this editor at lhaas@
