ITR filing 2025: Are you a social media influencer? Here's how to file your income tax returns right

Social media influencers should carefully choose between ITR-3 and ITR-4 (Sugam) while filing their returns

The income tax return (ITR) utilities for financial year 2024-25 (assessment year 2025-26) have introduced a specific code—16021—for 'influencers' who draw income from their social media activities, including promoting products and services on such platforms.

“Until last year, no specific code was assigned to this activity. Now, the code has been enabled under the ‘profession’ category in ITR-3 as well as ITR-4 (Sugam),” said chartered accountant Himank Singla. Like social media influencers, bloggers, online coaches and other gig workers also have to pay tax on income earned during the year and file returns. You will have to use either ITR-3 or ITR-4 (Sugam) for the purpose.

Choose the right form

Selecting the correct ITR form is a crucial part of the filing process—using the wrong form can lead to incorrect disclosures and may result in notices from the I-T department. The right form depends on your income level, sources of income earned during the financial year and whether you are opting for the presumptive taxation scheme, which aids small businesses and professionals meet compliance requirements.

Social media influencers typically need to choose between ITR-3 and ITR-4 (Sugam). You can claim deductions for expenses incurred in the course of your work. If your gross receipts breach a specified threshold, you may be required to maintain books of accounts.

Alternatively, you can choose the presumptive taxation scheme, which simplifies compliance by removing the need to maintain books and undergo tax audits. Under this scheme, you can declare a fixed percentage of your income as taxable—8 percent (6 percent for digital receipts) in the case of business income and 50 percent for professional income.

If you opt for the presumptive scheme, ITR-4 (Sugam) will be the applicable form. Under Section 44AD of the Income-tax Act, the turnover limit is Rs 3 crore, provided that the total amount received in cash does not exceed 5 percent of total gross receipts; otherwise, the limit is Rs 2 crore.

Also read: ITR filing 2025: Salaried taxpayers steer clear of unverifiable deductions, increasingly opt for new tax regime, say CAs

The presumptive taxation scheme under Section 44ADA is applicable to resident professionals whose gross receipts do not exceed Rs 50 lakh in a financial year. If cash receipts do not exceed 5 percent of gross receipts, then the limit goes up to Rs 75 lakh.

“The code for social media influencers has been introduced under the 'profession' category, which prima facie appears inconsistent with Section 44AA, as social media content creation is not notified as a ‘specified profession’ under Rule 6F. This has implications for the applicability of audit limits and presumptive income schemes under sections 44ADA, 44AD or 44AB. This has led to ambiguity over whether they should file under 44AD as business income or risk misclassification by using the new ‘professional’ code,” said  Singla, adding that the I-T department ought to issue a clearer notification or explanatory circular to eliminate the confusion.

“Strictly going by the definition of 'specified profession' under section 44AA of the Income Tax Act, 1961, social media influencers cannot be considered professionals. So, the code of 16021 as specified by the new ITR filing utility bringing the 'social media influencer' in the category of a professional is inconsistent with the legislative provisions. However, influencers, even those with turnover of Rs 2 crore, were claiming the benefit of section 44AD (offering 6 percent of gross receipts as tax). It seems, the I-T department has taken this step to prevent such practices,” said Mayank Mohanka, founder-director of TaxAaram.com.

However, Mayank points out that the change in the utility could be challenged in the courts as it has been done without amending the definition of 'specified profession' under the tax laws.

Cross-check AIS and Form 26AS

Even before choosing the form, your first step in the return-filing process should be to compare your data with the information available in the Annual Information Statement (AIS) and Form 26AS. Any discrepancies found in the AIS can be flagged directly on the income tax e-filing portal (incometax.gov.in).

If you're confident that your income, deductions and expenses are accurately reported, you can submit your feedback on the portal before proceeding to file your return. In case there are errors in the tax deducted at source (TDS) reflected in Form 26AS—the tax credit statement—contact the relevant deductors (such as banks that deduct TDS on interest from savings or fixed deposits) to get the details corrected.

Also read: ITR filing: Claiming fake 80C, HRA tax deductions? Beware of I-T notices

Claim only genuine deductions

While documentary proof is not required to be uploaded while submitting returns, it is best to preserve the evidence to back your deduction claims. On your part, do not make the mistake of claiming deductions you are not entitled to.

The I-T department has, over the years, increasingly relied on data analytics, AI tools and information in AIS to verify the accuracy of your ITR. Therefore, maintaining records meticulously will ensure that you can produce proof should you receive I-T queries later.

Complete verification of returns within 30 days

This is the final step in the return-submission process and is applicable to all. It is mandatory to verify your returns within 30 days of online submission. You can either do it online or send Form ITR-V to the I-T department’s Centralised Processing Centre, Bengaluru, within 30 days. The electronic mode is quick, simple and easier to monitor.