Creators, Don’t Get Caught: The New Tax Traps You Need to Dodge

The New Rules, Unpacked

India’s tax landscape for freelancers and digital creators is changing fast in 2025. Whether you’re a graphic designer, YouTuber, or Instagram influencer, here’s what you need to know to stay compliant and keep more of your earnings.

Default Tax Regime Switch

The new tax regime is now the default for all taxpayers. If you want to stick with the old regime (which allows more deductions), you must opt out by filing Form 10-IEA before your tax return deadline.

New tax slabs for FY 2025–26:

Income Range (₹) Tax Rate

Up to 4,00,000 0%

4,00,001 – 8,00,000 5%

8,00,001 – 12,00,000 10%

12,00,001 – 16,00,000 15%

16,00,001 – 20,00,000 20%

20,00,001 – 24,00,000 25%

Above 24,00,000 30%

GST and TDS: No More Free Passes

If your annual turnover exceeds ₹20 lakh (₹10 lakh in special category states), GST registration is mandatory. Most services attract 18% GST.

Every professional service payment above ₹30,000 in a year is subject to 10% TDS. Brands and clients must deduct this before paying you.

If you pay other professionals (like editors or designers) more than ₹30,000, you may also need to deduct TDS—unless your receipts are under ₹50 lakh and you’re not audited.

Influencers: Freebies and Barter Are Taxable

Free products, luxury trips, or gadgets received for brand promotions are now taxable at their fair market value—even if you don’t get paid in cash.
Payments in crypto or NFTs? These are taxed at 30%, with no deductions except the cost of acquisition.

Presumptive Taxation for Simplicity

If your freelance receipts are under ₹50 lakh (₹75 lakh if 95%+ payments are digital), you can opt for presumptive taxation: pay tax on 50% of your gross receipts, no need to track every expense.

Advance Tax and Compliance

If your total tax liability exceeds ₹10,000 in a year, you must pay advance tax in installments. Missing deadlines can mean penalties.

The Bottom Line

Freelancers and creators are now firmly in the tax spotlight. Keep records, know your slabs, and don’t ignore GST or TDS. The new rules are strict, but with the right moves, you can stay compliant and avoid nasty surprises.

Sources: Financial Express, StockGro, ClearTax, Winvesta, Tax2Win, Bajaj Finserv