Remuneration to director

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ajaykumar VISHWAKARMA (Querist)
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14 January 2015 please guide us if director is himself majority shareholder, then what is the way to get the income out of profit made by company, without declaring dividend, as per companies act, 2013.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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15 January 2015 Section 197 of the Companies Act, 2013 prescribed the maximum ceiling for payment of managerial remuneration by a public company to its managing director whole-time director and manager which shall not exceed 11% of the net profit of the company in that financial year computed in accordance with section 198 except that the remuneration of the directors shall not be deducted from the gross profits. Further, the company in general meeting may, with the approval
of the Central Government, authorise the payment of remuneration exceeding 11% of the net profits of the company, subject to the provisions of Schedule V.
The net profits for the purposes of this section shall be computed in the manner referred to in section 198.

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