Tax for designers in India

Graphic, web and interior design is generally a business, so use presumptive Section 44AD (6% digital, 8% other), not 44ADA, the exception is a qualified architect, who is a specified profession on 44ADA. GST is 18% on design services with input credit (overseas work may be zero-rated export), registration applies at Rs 20 lakh, and 194J TDS is commonly deducted but does not change the presumptive scheme.

Presumptive + GST + TDS at a glance

Presumptive taxation

Section:: Sec 44AD
Deemed profit rate:: 6% on digital receipts / 8% on other receipts
Classification:: business

GST treatment

Slab:: 18%
SAC:: 998391 (design services)
Composition eligible:: Yes
Reverse charge (RCM):: Not applicable

TDS exposure

Last reviewed: 29 May 2026

Guidance, not advice. We explain the rules, we don't assess your situation. Always seek financial or tax advice from your accountant, or contact Income Tax Department. Read our editorial scope →

Graphic, web and interior design in India is generally a business, so presumptive taxation under Section 44AD applies, not the 50% professional scheme under Section 44ADA. The one exception is a qualified architect, which is a specified profession that does fall under 44ADA. For most designers, GST is 18% on design services, registration applies at Rs 20 lakh of service turnover, and clients frequently deduct TDS under Section 194J.

What business structure do designers use?

The common patterns for designers are: Sole proprietor, simplest, suits most freelance designers on 44AD, Partnership or LLP, for a design studio sharing clients and capital, Private limited, for a larger agency or product-design firm. The right structure depends on revenue, liability exposure, and personal circumstances, covered below.

Most designers are on Section 44AD, not 44ADA

A graphic, web or interior designer runs a business, not one of the notified professions listed for Section 44ADA, so the presumptive scheme is Section 44AD: a deemed 8% of turnover, or 6% on digital receipts. The genuine exception is a qualified architect, architecture is a specified profession, so a registered architect uses 44ADA at 50%. An interior designer who is not a qualified architect stays in 44AD. Clients commonly deduct 194J TDS on design fees, but that deduction does not by itself make a designer a 44ADA professional.

Graphic, web and interior designers are a business on Section 44AD (6 or 8%); only a qualified architect is a specified profession on 44ADA. 194J TDS does not change this. (Income-tax Act 1961 ss.44AD/44ADA (Income-tax Act 2025 s.58); architecture is a specified profession under s.44AA)

GST: 18% on design services

Design services are taxed at 18% GST with input-tax credit on software, hardware and subscriptions, under SAC 998391. Registration is required once service turnover crosses Rs 20 lakh. Where you design for overseas clients, the work may qualify as a zero-rated export of services (subject to the place-of-supply and payment-in-foreign-currency conditions), which lets you claim a refund of input credit. Confirm the export conditions before treating any invoice as zero-rated.

Design services are GST 18% with input credit; design for overseas clients may be zero-rated export of services if the conditions are met. (CGST Act 2017 ss.22-24; IGST Act 2017 s.16 (zero-rated export); SAC 998391)

Working with overseas clients

Many designers bill foreign clients. If the place of supply is outside India and you receive payment in convertible foreign exchange, the supply is generally a zero-rated export of services, no GST charged, with the option to claim a refund of accumulated input credit (via LUT without paying tax, or by paying and claiming a refund). Keep FIRCs or bank realisation evidence. For income tax, this is still business income under Section 44AD, reported in INR.

Allowable expenses

Category	Examples	Tax treatment
Hardware	Computer, monitor, tablet, drawing devices	Deductible; GST input credit if registered; in deemed profit under 44AD
Software and subscriptions	Design suites, fonts, stock assets, cloud storage	Deductible business expense; input credit if registered
Workspace	Studio or co-working desk, internet, electricity	Deductible if keeping books; apportion home-office use
Freelancers and outsourcing	Illustrators, developers, print vendors	Deductible if keeping books; watch 194C/194J TDS obligations if you pay them
Marketing and admin	Portfolio site, ads, phone, accountant	Deductible (apportion personal phone use)

Vehicle and travel costs

Vehicle costs are rarely material for a desk-based designer. An interior designer visiting sites can claim running costs under regular books, or rely on the deemed profit under Section 44AD which is treated as inclusive of such costs.

Capital allowances and equipment

On regular books, computers, monitors and design hardware depreciate (computers generally at 40% WDV, other equipment at 15%). Under Section 44AD no separate depreciation is claimed, but keep invoices so the written-down value is correct on any later sale.

Worked example

Ananya — Bengaluru, KA

freelance graphic and web designer (Indian and overseas clients) (2026-27)

Annual receipts Rs 28 lakh: Rs 18 lakh Indian clients (who deduct 194J TDS), Rs 10 lakh from a US client paid in USD. An advisor suggested 44ADA at 50%.

She is a designer, not a qualified architect, so she correctly uses Section 44AD: deemed profit 6% of Rs 28 lakh = Rs 1,68,000, below the Rs 4 lakh new-regime exemption, so income tax is nil; she files and reclaims the 194J TDS. Had she used 44ADA at 50%, deemed income would have been Rs 14 lakh, hugely overstating her tax. For GST, her Indian work is 18%, and the US work is a zero-rated export of services (paid in USD, with bank evidence), on which she can claim an input-credit refund.

Common audit triggers for designers

Being placed on 44ADA at 50% as a designer when 44AD is correct (unless a qualified architect)
Treating overseas invoices as zero-rated export without meeting the conditions or holding FIRCs
Cash receipts over 5% of turnover while using the Rs 3 crore 44AD limit
194J TDS in 26AS or AIS not reconciled with income reported
Claiming full input credit while also having exempt or non-GST income
No GST registration after crossing Rs 20 lakh service turnover

Frequently asked questions

Is a designer on 44AD or 44ADA?+

Most designers (graphic, web, interior) are a business, so Section 44AD (deemed 6 or 8%). The exception is a qualified architect, which is a specified profession under the tax law and uses 44ADA at 50%. An interior designer who is not a registered architect stays on 44AD. Clients deducting 194J TDS does not change this.

How is my work for foreign clients taxed?+

For income tax it is business income reported in INR under Section 44AD. For GST, if the place of supply is outside India and you are paid in convertible foreign exchange, it is generally a zero-rated export of services, no GST charged, and you can claim a refund of input credit (via LUT, or by paying and reclaiming). Keep bank realisation evidence (FIRCs).

Should I register for GST as a designer?+

You must register once service turnover crosses Rs 20 lakh in a financial year (Rs 10 lakh in special-category states). Even below that, registration can be worth it if you export services and want to claim input-credit refunds, or if your clients require a GST invoice. Design services are taxed at 18% with input credit.

What can I claim against my design income?+

Your computer and hardware, design software and subscriptions, fonts and stock assets, co-working or home-office costs (apportioned), and payments to subcontracted illustrators or developers are all deductible. If you use presumptive Section 44AD, the deemed profit is treated as already net of these, so you do not itemise them.

Last reviewed: 29 May 2026