In a notable shift this tax season, the Income Tax Department has introduced a dedicated classification for social media influencers and digital content creators, aiming to streamline the return-filing process for this growing profession.
For the assessment year 2025–26 (financial year 2024–25), a new profession code — ‘16021’ — has been added under the Income Tax Return (ITR) utilities. The code is applicable to individuals earning from brand promotions, product endorsements, and digital content creation, and can be selected under the “profession” category in ITR-3 and ITR-4 (Sugam) forms.
The move is expected to ease compliance for influencers, bloggers, online coaches, and other digital professionals by categorizing their income more clearly.
Tax experts noted that content creators will now need to choose between ITR-3 and ITR-4, based on their earnings and whether they opt for presumptive taxation—a simplified scheme that allows professionals to declare a fixed portion of their income and avoid maintaining detailed financial records.
Under Section 44AD, those earning business income can declare 8% of receipts (or 6% for digital transactions) as taxable income, provided total receipts don’t exceed ₹2 crore—or ₹3 crore if cash transactions remain below 5%.
The ITR-3 form is suitable for individuals and Hindu Undivided Families (HUFs) earning income from business or profession, including remuneration from partnership firms. It also allows reporting of income from salary, house property, capital gains, and other sources. However, it is restricted to taxpayers with professional or business income.
On the other hand, ITR-4 (Sugam) is designed for individuals, HUFs, and resident partnership firms who opt for presumptive taxation under Sections 44AD, 44ADA, or 44AE.
The new code and updated filing guidance reflect the government’s recognition of the rapidly expanding digital economy and its efforts to bring online income under structured tax compliance.
👉 Click here to read the latest Gujarat news on TheLiveAhmedabad.com