Me and my wife develop mobile apps and games. We receive payments from Google and Amazon for the app sales and ad revenue to my wife's account, which is a normal savings account. This year when we filed our income tax, we showed all the revenue under my wife's income. She had to pay income tax whereas I did not. We operate like a partnership with 50-50 stake, but we do not have any partnership agreement. My query is whether we can split and show the revenue received in my wife's account amongst the two of us, in order to reduce tax. Or is there any legal or other formalities involved. Thank you.
Menu
Revenue share in partnership
Replies (4)
Either of you can lead a proprietor ship firm. The proprietor can give salary to other.
One will file under ITR-4 and the salaried person under ITR-1/2/2A. Prop firm can obtain TAN no and deduct TCS from salaried person.
This is what i think. other experts also give some suggestions.
Thank you for the quick reply. We would like to remain as a partnership with us being equal share partners as we don't intend to expand it as a business. This concluded financial year, my wife filed ITR 4 for the full income. My question is specifically regarding whether it is ok to have all the revenue come to one bank account in her name, while the two of us considers it as say each receiving 50% of the revenue for tax purposes.
She has to transfer amt from her acc to ur acc.
A CA will tell you whether a partnership firm needs to be registered.
Both of you are self employed professionals in true sense.
It is not mandatory to get a partnership firm registered. You can continue business anyways also. But it is advisable that you get the firm registered which will help you in other legal matters as well in future. Also, you should show your income in both of your accounts as share of profit so that both of you together can claim maximum benefit of taxes.
Recent Topic
- Is CA through direct entry easy for a commerce stu
- Dividend and withholding tax - DTAA- RSU
- NRI Query: Capital Gains Tax Exemption under Secti
- Royalty payment to UK
- Calculate ITR2 tax with equity and non equity prof
- LTCG on residential property sale - Rebate?
- TDS MISMATCH AND AIS
- Return filing for intervening period upto date of
- EPF Withdrawal taxation
- While e filing otp not generating
Related Topics
CAclubindia
