In pvt ltd company salary or remunaration what is applicable to the directors

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In a Private Limited company, directors are typically paid remuneration rather than a salary. Crucially, there are no statutory limits on the amount of remuneration a Pvt Ltd company can pay its directors. This is because the restrictions outlined in Section 197 and Schedule V of the Companies Act, 2013, specifically apply to public companies, not private ones.

bhaskarreddy

bhaskarreddy (Querist)
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09 December 2021 Hi experts

In private limited company we have to pay directors remunaration or salary ? if we pay that what is the limitation of Pvt ltd company ?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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09 December 2021 There is no limit on remuneration for Private Limited Companies, they can pay any amount of remuneration without complying with the provision of Section 197 and Schedule V of the Companies Act, 2013.

As per the provisions of Companies Act, 2013, the restriction under Section 197 and Section 198 shall apply only when managerial remuneration or remuneration paid by a public Company. Hence, any remuneration paid or payable by a private company to its director shall be out of purview of the above said section and shall not be counted for the purpose of maximum remuneration payable by the company.

bhaskarreddy

bhaskarreddy (Querist)
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09 December 2021 OK Sir tq which can refered to me like salary or remunaration to the directors

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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09 December 2021 Directors do not take salaries but remunerations from the Company.

bhaskarreddy

bhaskarreddy (Querist)
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09 December 2021 ok sir tq so much for your replay

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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09 December 2021 Most Welcome ..