Should i pay tax on Adsense income

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1.Should i pay tax if the profit is less Rs 255,000 per year ?
2.Should i register the website as a company or self employed so that my expenses are taken into account ? .If yes can i do so online ?
3.What advantages i get if i register as a company ?
4. Adsense income fluctuates every month and so does the profit , how should i fill my tax return form

Thanks for talking time to help me out ?

4 Replies

gices Level 6

Yes, your Adsense income is taxable.

Now to answer your specific questions:

Self employed people get a tax allowance (Rs255,000 for individuals with no dependents) and if your profit is less than that, you don't have any tax to pay.
Both as a company or as self employed, you can list your expenses and those will be taken into account. Just make sure they are really business expenses. It's easier to just go to the Companies House in Port Louis to register.
When you go bankrupt as a self-employed, whatever you possess may be sold to pay your debts off. A company is a legal entity and only assets owned by the business are taken into account not those of the directors/owners. There are many other differences, you need to consult a legal person for better advice, I'm not one :P
You will only fill out your tax form at the end of the year (applicable for Rs2M profit threshold, above that it's quarterly), so it will be the total revenue for 12 months.

Hope that helps :)

2 Reply

Th3Gr33k Level 1

Thanks you so much for your reply gices.I have few more questions

From your reply its seems that i must register as a self employed or as a company.Is that right?

My profit is less than 2M

I am pretty sure that Hosting and Maintenance counts as expenses but how about the following

Advertising (if i advertise my website does it count as an expense)
Suppose i buy a new computer , does it count as an expense because without a computer nothing is possible :P
A tax year is Jan-December and Tax are paid around march i think , so if ever i need to pay tax it will be based on last year profit.Also i think MRA will ask for some proof for what i am saying but that is easily obtained through my bank (i pay everything through paypal)

Correct me if i am wrong and i never filled tax form so far.

P.S i will appreciate a post on that :P

gices Level 6

Yes you need to be registered as self employed or create a new company for what you're doing.

All expenses which are business related can be claimed back. If you need a printer, that can also be listed as an expense. You just need to keep your receipts or other proof or purchase so that if they audit you, you have nothing to worry about.

The tax form will tell you for which tax year you're filling. For example, we are in 2015 now, so you'll be filling the form for last year which is 2014 (Jan-Dec) and revenue will be based on 2014.

Paypal transactions can be used as proof too :)