Remuneration Calculation(Partnership firm)

This query is : Resolved

Pradeep k (Querist)
Follow

05 April 2011 Hi
I checked the partnership deed & the calculation of remuneration is different from the normal rule
-----------------------
In case of loss or book profit up to Rs.75000 --- Rs.50,000 - or 90% of book profit whichever is for the year higher
On the amount of book profit exceeding Rs.75000--- 60% of the excess over Rs.75000
but not exceeding Rs.1,50,000 for the year
On the book profit exceeding Rs.1,50,000 for the year--- 40% of the excess over Rs.1,50,000
---------------------------------
My question is do i need to abide by the rule mentioned in the partnership deed or i can follow the new rule set by the authorities.
We also have the below clause in the partnership deed which i think can be used to change the remuneration calculation :-
"That the partners can change,add,modify,delete, or vary any terms and conditions of this deed by mutual consent in writing & such addition & deletion shall not required execution of fresh partnership deed and/or supplementary deed unless the same is relating to change in profit sharing ratio"

CA. Krishna K Neeraj

CA. Krishna K Neeraj (Expert)
Follow

19 April 2011 You can make supplementary partnership deed and incorporate the changes brought by the authorities.

Alternatively, you can continue calculation as per original deed for book keeping purposes. In that case, you will require to do calculation as per income tax rules in this regard and will have to disallow interest amount calculated as per original deed to the extent is excess than amount calculated as per income tax act

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now