Int.on capital of partners if firm declares income u/s44ad

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Querist : Anonymous

Querist : Anonymous (Querist)

16 June 2014 Dear sir,
If firm files its returns on presumptive basis i.e. @8% say in the A.Y.13-14. then how in the next year, calculation of int. on capital of the partners is done, as no books of accounts is required to be maintained

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)

16 June 2014 but atleast if there is no increase in capital then deed will be refrred for paying int...

Nikhil Kaushik

Nikhil Kaushik (Expert)

16 June 2014 well actually its simple...opening capital add profit less drawing and you get the new closing capital. please note that non-maintenance of books doesnt mean you cannot maintain your investment details.

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Rupesh Jain

Rupesh Jain (Expert)

20 June 2014 you cannot take intt. you can add profit share in partner capital a/c

Querist : Anonymous

Querist : Anonymous (Querist)

21 June 2014 Dear Experts, thanks for the reply. My query was on particular on the point of Calcualtion of Interest on capital if books of account not maintained and Nikhil Sir, you have thrown some light on the same point. However if I do the calculation so, whether the assessment officer will consider my calculation of Int. on Capital & allow the same as deduction. What is the points / caution statement you will give in this regard.

Nikhil Kaushik

Nikhil Kaushik (Expert)

21 June 2014 first and foremost precaution is that let each partner maintain his own memorandum capital account, instead of the firm doing so. This would help in preventing AO to allege that you are maintaining books of accounts under 44AA.

second ensure partnership deed does provide for payment of interest on capital.

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