Income Tax on Google Adsense Income In India from YouTube Blog

Indian income tax on google adsense from wordpress, website or youtube channel by salaried professional. Pay advance tax if total tax per year > 10k.

Written by Anil Gupta
  By Anil Gupta          Updated  30 Dec, 19

  78    


Adsense Income in India from Youtube or Blog is fully Taxable

Tax Treatment for Google Adsense Income in India is fully taxable.

If you are a blogger (using wordpress) or own a website like us or have a YouTube channel like us and have questions in your mind on how to treat your income from Google ADS (Adsense) or any other AD network income with respect to income tax.

Don’t worry, we have answers to your queries. The main point to keep in mind is that whatever is the mode of income, it is taxable if you are a resident Indian.

Is income from Google Adsense Taxable?

Yes. The amount that you receive is your income and is FULLY taxable as per Indian income tax laws.

Income Tax treatment of AD Income From Blog/website

There are two broad scenarios that you may fall into:

1. Your main business is running your blog/website/YouTube channel

If blogging or website is your full time activity and your main source of income, then the income should be designated as “Income from Business or Profession” for income tax purpose.

This effectively means that you are running a business either as a company or a sole proprietorship. You are eligible to deduct all the expenses that you make to earn the income from ADS.

For example:

You may be incurring costs on advertisement for marketing your blog/website, have some employees whom you pay salaries, travel frequently to attend conferences etc. All these expenses are your business expenses and can be deducted from your AD revenue before reaching at a net profit figure.

The income tax should be calculated on NET profit as per the relevant tax slab that it falls in.

Related: Calculate your in-Hand salary after Indian Income tax

2. You work as an employee with a company, blog/website income is part time

This is the most popular scenario and most of the people might fall into it. It never hurts to start a blog part time to earn a decent amount along with your regular job.

But the income that you derive from this part time activity is also taxable.

If you are salaried, then obviously you receive your monthly salary after the TDS (tax deduction at source). But, this tax is only calculated on your salary portion.

The best treatment of this part time income in tax books is to declare it as “Income from Other Sources”. This amount is added to your taxable income and the applicable tax is calculated as per the relevant tax slab.

Obviously, you are eligible to deduct any expenses that you would made to earn this income. The same example that I gave in above point is applicable here too.

You should deduct all the expenses and then declare the NET profit figure as “Income from Other Sources” in your income tax return.

Your employer may or may not provide a provision to declare the “Income from Other Sources” to deduct the appropriate tax in advance. If it does, you will see the tax credit in your FORM 16 issued by your employer. Else, you need to declare this income in ITR (Income Tax Return) and pay the taxes.

Google does not deduct taxes (TDS) while issuing payment to bloggers like Indian companies do for their employees?

No. Since there is no employer-employee relationship between you and the AD network company (Google Adsense in our case), they are not liable to deduct TDS.

It is your responsibility to add this income to your total income and pay taxes to Indian government.

I work in a private limited company and earn a very small amount like 3k-4K per year from blogging. Am I eligible to pay taxes?

It does not matter how much you earn from blogging. You should add the amount (whatever the amount is) to your total income and then find out the tax.

It is possible that your salary taxable income falls under the exempted income and you are NOT paying any taxes in your company. But, if you add your income from blogging, this taxable income may cross the maximum exemption limit.

In this case, you are liable to pay income tax.

For example,

  1. Lets say that your yearly taxable income in your job is 1,60,000 and you are a male. Then as per income tax slabs for year 2011-12, you do not need to pay any tax up-to 1,80,000 per annum.
  2. You earn 3k per month from blogging after deducting all relevant expenses.
  3. Now, adding this income i.e. 36,000 (12*3000) to your taxable income i.e. 1,60,000 take you above the maximum exemption.
  4. New taxable income= 1,60,000 36,000 = 1,96,000
  5. So, you need to pay tax @10% ‘education cess’ on 16,000 (1,96,000 – 1,80,000).

Do I need to pay service tax on Google Adsense earnings?

No. You as a adsense publisher are NOT required to pay service tax. It is the responsibility of Google to pay service tax. You also do NOT need to apply for a service tax number.

Do I need to pay ADVANCE Income tax on Google Adsense earnings?

If you expect your Adsense income earning to enough to make you reach an yearly income tax level of INR 10,000 per year, then, yes.

The Indian income tax laws say that you need to pay advance tax on your business income if the total tax at the end of year would be equal to or more than 10k.

Advance tax applies to all tax payers, salaried, freelancers, and businesses. Senior citizens, who are 60 years or older, and do not run a business, are exempt from paying advance tax.

I hope I have covered all the doubts related to ADS earning from Blogging/website.

If you still have any questions, please write into comments and I will try to answer to the best of my knowledge.


India
 






   78 Useful Questions & Answers from comments



  1. Devi Singh
    Devi Singh 14 Jan, 19 at 9:47 am

    Very nice article. Can we opt for presumptive tax for adsense income


    • Anil Gupta
      Anil Gupta 14 Jan, 19 at 10:04 am

      What do you exactly mean by presumptive tax?


      • Devi Singh
        Devi Singh 9 Feb, 19 at 10:03 am

        I make apps and publish on Google play store. I earn money from adsense ads in the apps. My doubt was whether I can opt for presumptive income tax under section 44 ad or ada . If yes then whether I should opt for declaring 8 percent profit or 50 percent profit. How you report your adsense income while filing income tax return


        • Anil Gupta
          Anil Gupta 9 Feb, 19 at 10:13 am

          I don’t think Google has any TDS deduction for Indian ad income. If it has, I am not aware of it.


  2. CHARAN
    CHARAN 7 Sep, 18 at 11:48 am

    I’m in a big confusion! I’m 20 I earn 10 lacs from youtube per month mostly it depends on my work my gameplays etc sometimes less money ! So I don’t have any it returns I started earning a good amount of money from last three months ! So what are the best steps for me to take ! And I want to pay less tax I can’t pay 30% of all my earnings it’s huge loss for me ( 4 yearsy of hard work I’m started earning good now ) what do I have to say to the auditor and how much tax I have to pay ?


    • Anil Gupta
      Anil Gupta 7 Sep, 18 at 11:57 am

      Hi Charan,
      That’s a very good amount of money that you are earning.
      You have to talk to CA and they can create a structure for you where you can claim all your expenses and then pay tax only on the net profit.
      The final tax will depend on the NET profit that you get.


    • sangeetjass
      sangeetjass 13 Dec, 18 at 4:19 am

      Hi Charan, please share your Youtube channel, I would love to subscribe..


  3. Manoj Pandey
    Manoj Pandey 27 Aug, 18 at 11:15 am

    Sir, I helped my wife to setup a blog and YouTube channel, from both she earns around 25k INR per month on her bank account. Now, which ITR form should I fill for her? and how do I show the expenses incurred bills and to whom?


    • Anil Gupta
      Anil Gupta 27 Aug, 18 at 12:14 pm

      You have to use the form for business income if she does not have any other income. You can claim business expenses on the same form.
      If you do not know how to do it, you should contact a CA who can guide you.


  4. abhishek
    abhishek 25 Jul, 18 at 10:27 am

    Thanks for the clear explanation Anil,
    I am a college graduate. And my only source of Income is Adsense and it is very well over the Tax slab. And I am the sole owner of the entity while I pay others to work for me. So I guess I fall under Category 1, right?

    I just want to ask, what exactly should I do from now? Do I need to register as a company? And how to deduct the payment that I pay to others? We have no agreement of any sorts. I just pay them via Paytm.

    I have been doing this for over a year now. I know I am in trouble :/

    Any kind of help in this matter would be much much appreciated. Thanks for the awesome article 🙂


    • Anil Gupta
      Anil Gupta 25 Jul, 18 at 11:07 am

      You should contact a CA who can maintain your ledge and account for all the expenses and salaries that you pay for your blog.
      At the end of financial year, CA can file the Income tax return.
      There is no need to create a company unless you want to. You can operate it as sole proprietorship as you are currently doing.


      • abhishek
        abhishek 26 Jul, 18 at 9:05 pm

        Hey thanks anil for the quick reply. Will surely do that.
        You are doing good work btw 🙂


  5. Sibin
    Sibin 16 Jul, 18 at 2:08 am

    Very clear explanation. Best one available till now.Thanks. But I have one doubt. I am salaried and comes under 20% slab. I have an ads revenue of Rs.3000 per month from my android app (Individual account with admob). As per above I have to show it under Income from other sources. But in Quora, i read we cannot claim any expenses if we do so. You article says we can claim. Can I claim expenses still under Income from other sources? Please clarify


    • Anil Gupta
      Anil Gupta 16 Jul, 18 at 7:42 am

      Yes, you can claim any expenses that you made to earn that ‘Income from other sources’ legally.


      • Sibin
        Sibin 17 Jul, 18 at 4:14 am

        Hi Anil, thanks for quick response. I asked a CA and he told it should come under Income from business or profession. As per him only dividends, Interest etc can come under Income from other sources. How can we check what all can come under Other sources? In case if he files my ITR with this income under Busines income head, am I required to have some registration or other documents to show as a business?. I don’t have any as I am doing it as Individual part time hobby. Pls share your view.


        • Anil Gupta
          Anil Gupta 17 Jul, 18 at 7:28 am

          You can choose to consider this income as ‘Income from business’ as well.
          Read this for more references:
          https://cleartax.in/s/other-income-sources


          • Sibin
            Sibin 21 Jul, 18 at 12:20 pm

            Thank you


  6. Ravi
    Ravi 7 Jul, 18 at 1:00 am

    Good explanation till date. Even though its an old post but contains most of the information.


    • Anil Gupta
      Anil Gupta 7 Jul, 18 at 6:59 am

      Thanks.


  7. Shilpa Jain
    Shilpa Jain 5 May, 18 at 5:25 am

    Hello Anil,
    What are your views about section 44ad and 44ada?


  8. Sachin
    Sachin 8 Mar, 18 at 6:36 am

    Hi Sir,

    As now in India, we have GST. Will GST apply on google adsense income


    • Anil Gupta
      Anil Gupta 8 Mar, 18 at 7:26 am

      GST should be paid by Google and they should have already paid it before releasing the money to you. As a publisher, you do not have to do anything.


  9. Sachin
    Sachin 8 Mar, 18 at 6:37 am

    Hi Sir,

    As now in India, we have GST. Will GST apply on google adsense income


    • Anil Gupta
      Anil Gupta 8 Mar, 18 at 7:27 am

      GST should be paid by Google and they should have already paid it before releasing the money to you. As a publisher, you do not have to do anything.


  10. Jarkko
    Jarkko 14 Jan, 18 at 9:35 am

    I am an NRI currently in UAE, Can I send my adsense payments to NRE account ?
    Do I have to file income tax return for this ?


    • Anil Gupta
      Anil Gupta 14 Jan, 18 at 11:13 am

      1. It depends on what country is attached to your adsense account.
      2. If it is India, then you CANNOT send money to NRE account as Google will send you money in INR.
      3. If it is UAE that you have mentioned in your adsense account, then Google will send you payments in UAE account and then you can send that money to NRE yourself.
      4. NRE account can only take money in foreign currency.
      5. On NRE account money, there is no Indian income tax applicable. You will have to follow UAE’s tax rules.


      • NIBIN
        NIBIN 27 Jun, 18 at 3:01 am

        google will send money to NRI Account


  11. Sandipan
    Sandipan 13 Jan, 18 at 12:43 am

    Its best to treat Adsense Income as Income from Business and Profession so that one can claim deduction for expenses like hosting, domain and other incidental costs.


    • Anil Gupta
      Anil Gupta 13 Jan, 18 at 12:06 pm

      Yes, you are right. Thanks for your inputs.


  12. Keshavprasad
    Keshavprasad 31 Mar, 17 at 9:23 am

    I am a salaried employee, do some speculative stock trading, for which I am filing ITR 4, and also earn some google ad revenue from some of my android apps. Should I show the google ad revenue under business income, or as part of other income? If I show it under other income, can I claim depreciation for the mobile phone I bought in other to build the android apps, under section 57?


    • Anil Gupta
      Anil Gupta 31 Mar, 17 at 11:42 am

      You should show it as business income to claim expenses and depreciation.


      • Keshavprasad
        Keshavprasad 6 May, 17 at 7:25 am

        If I claim the Google Adsense income as business income, am I liable to furnish a report under Section 92E?


        • Anil Gupta
          Anil Gupta 8 May, 17 at 8:18 am

          I am not a CA and hence, can’t really guide you on Section 92E. Please consult a CA for better opinion.