Actors receive income from the following sources.
1)Income by way of remuneration from acting the cinemas
2)Income received from advertisements
3)Income received from acting as a brand ambassador.
Taxability of Remuneration received by the actors
Remuneration for actors shall be in the nature of professional charges and hence the taxability of the same shall be under income from business and profession.
a)Books of accounts are to be maintained as per the 44AA of the income tax act 1961 in the following cases
Where the gross receipts from the specified profession(Acting) exceed Rs. 1,50,000 in any of the 3 years immediately preceding previous years relevant to current previous year, or not likely to exceed Rs 1,50,000 in the current previous year.
Following books of accounts need to be maintained as per section 44AA
1)All bills in original for those exceeding the amount of Rs 50 per bill
2)All bills as a carbon copy if amount exceeding Rs25
3)Ledger (for example, Details of the services rendered to clients has to be maintained as per the accounting format known as ledger)
5)Cash Book (All receipts for the services rendered are to be maintained in a separate book known as Cash/Bank book)
Major Expenses which are allowed to be deducted for actors.
1)Expenditure relating to paying salaries and other charges to the personal assistants, managers, engaged by the actor.
2)Amount paid to the fitness trainer and other trainers relating to the vocal, acting and other for imparting other skills.
3)Periodic utility & maintenance charges such as rent paid for the office premises, electricity and telephone charges used for official purpose.
4)Holding an office at home? yes you can claim the rent, electricity, telephone and maintenance of the same to the extent used for such official purpose.
5)Any expenditure incurred towards diet such as purchase of proteins, supplements, and salary payment to the fitness trainer.
b)Yes..! no need to maintain books of accounts, neither maintain a register a bills. Here is how you can opt this out.
As per the new amendment in the finance act 2016 a new concept of presumptive income is applicable to the actors in the following cases,
i)For those Actors whose form of business is in the nature of sole proprietorship, Partnership, or HUF, if the total gross receipts in the previous year done not exceeding Rs.50,00,000, there is no requirement of filing Income tax audit report for the said business, provided the rate of income declared on such presumptive income is not less than 50% of the gross receipts.
ii)No books of accounts are required to be maintained under section 44ADA
iii)Income shall be declared @50% on the total receipts/Turnover in the relevant previous year.
iv)However advance tax has to be paid even for such professionals in one installment which shall be 15th of March of the relevant previous year.
iv)However Advance tax has to be paid even for such professionals in one installment which shall be 15th march of the relevant previous year.