Deemed divided
This query is : Resolved
bunty shaw
(Querist)
11 December 2012
we have three company which is pvt ltd and three director. all director have shareholding in every company. and with in every company we have internal cash & bank transaction.is all transaction comes under deemed divided and tax liability arise from this inter company transaction. plz advice sir....
11 December 2012
Deemed dividend - Section 2(22) (e)
Loans & advances (other than in ordinary course of business) by closely held company deemed as dividend
Payment by a company not being a company in which public are substantially interested.
Of any sum by way of loan or advances.
To beneficial shareholder of not less than 10% of voting power.
To any concern in which such a shareholder is a member or a partner and in which he has a substantial interest
To any person on behalf of or for the individual benefit of such a shareholder.
Treated as dividend to the extent to which the company possesses accumulated profits
Meaning of Accumulated profits
All profits upto the date of distribution or payment.
Loans & advances (other than in ordinary course of business) by closely held company deemed as dividend
Payment by a company not being a company in which public are substantially interested.
Of any sum by way of loan or advances.
To beneficial shareholder of not less than 10% of voting power.
To any concern in which such a shareholder is a member or a partner and in which he has a substantial interest
To any person on behalf of or for the individual benefit of such a shareholder.
Treated as dividend to the extent to which the company possesses accumulated profits
Meaning of Accumulated profits
All profits upto the date of distribution or payment.
bunty shaw
(Querist)
13 December 2012
all the inter company bank transaction is liable to tax under deemed dividend?
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