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Partner in a partnership firm which is liable to audit

yashsr (CA) (2285 Points)

08 September 2013

Hello,

There is a partner say named 'A' in a Partnership Firm 'ABC Enterprises'. The Partnership Firm is liable to tax audit whereas the individual is not. What will be the due date of filing the Income Tax Return for the individual A?

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11 Replies

Shubham Singhal (Student- ICAI) (175 Points)
Replied 08 September 2013

31 july of every ay

yashsr (CA) (2285 Points)
Replied 08 September 2013

Why? Will it not be 30th Sept?

'a working partner of a firm whose accounts are required to be audited under this Act or under any other law for the time being in force'

What does working partner mean? Is a partner who is simply getting Share of Profit and Interest on Capital but no Remuneration a Working Partner?

CA BHUMIT SHAH (Consultant ) (270 Points)
Replied 08 September 2013

Hey YASHSR A "s due date of filing retutn is 30/9 of A.Y since his partnership firm is liable for Tax Audit & we also have to see whether he is a working partner or sleeping partner if he is a working partner then 30/09 otherwise 31/7

CA D.C. Bansal (Accounts Head) (283 Points)
Replied 09 September 2013

Any assessee who is a working partner of a firm whose accounts are required to be audited under this Act or under any other law for the time being in force may file his Income Tax Retrun latest by 30th day of September of the assessment year.

vishal (Student) (31 Points)
Replied 09 September 2013

If the partner A is a working partner then due date will be 30th of September Or if he is non - working partner then due date will be 31st of July

yashsr (CA) (2285 Points)
Replied 09 September 2013

What is the definition of working partner? If a partner is actively involved in the business but is not getting any Remuneration(he's getting only profit share and interest on capital), is the due date 5th Aug or 30th Sept for AY 13-14?

Deepesh Ashwin Shah (Chartered Accountant) (141 Points)
Replied 09 September 2013

30th September. Every year. There is a logic. Only after firm accounts get finalised. Patrners bs can be closed.

1 Like

sujith revisankar (articled assistant) (34 Points)
Replied 09 September 2013

The partnership deed spells out who among the partners is to be working partner. One among the partner or more than one or all the partners maybe working partners depending out on the partnership deed . Working partners are entitled to remuneration as per the deed. Income tax deduction will be available for such remuneration if it is within the limits prescribed by sec 40(b).

sujith revisankar (articled assistant) (34 Points)
Replied 09 September 2013

A partner who is getting only share of profits and interest on capital generally will not be a working partner (but if the deed says so he can be 1). As he is not a working partner his due date will be 31st july (augest 5th for AY 13-14).

sujith revisankar (articled assistant) (34 Points)
Replied 09 September 2013

I disagree with Mr. Deepesh that there is logic for it to be 30th september, as the income of a non working partner will be unaffected even when the income of the firm as per books and as per tax laws are different . But it is not the same case with a working partner. His income will be depending on the income of the firm under tax laws as it is subject to limits under section 40(b).

CA Ksheerabthi Nathan (CA in practise) (167 Points)
Replied 11 September 2013

a working partner is one who is engaged in the business of the firm. generally working partners are stated in the partnership deed. if not , then the partners who conduct the affairs of the business are treated as working partners. Generally remuneration is paid to them. But even if it is not paid ,it is not debar him from the capacity of working partner provided he is actively engaged.

in that case due date will be 30th september otherwise 31st July.