Remuneration to partners section 40(b)
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09 February 2021
We are Partnership engaged in service industry
For F Y 19-20 Net profit after remuneration paid to partners is Rs.10,76,119/-
Remuneration paid to partners is Rs.41,10,000/-
Income from other sources included in Rs.10,76,119/- is of Rs.8,19,344/-
My question is what will be amount deductible towards partners remuneration u/s 40(b) ?
For F Y 19-20 Net profit after remuneration paid to partners is Rs.10,76,119/-
Remuneration paid to partners is Rs.41,10,000/-
Income from other sources included in Rs.10,76,119/- is of Rs.8,19,344/-
My question is what will be amount deductible towards partners remuneration u/s 40(b) ?
13 February 2021
can any expert reply please
01 December 2021
the payment of remuneration should not exceed the following amounts. Any amount in excess of the below mentioned limits will be disallowed:-
Salary Allowed
a. On the first 3,00,000 of book profits or in case of a loss ..........
Rs. 1,50,000 or at the rate of 90% of the book profit (whichever is higher)
b. On the balance of book profits ................ at the rate of 60%
The computation of Book Profit for the purpose of Section 40b would be the net profit as shown in the P&L A/c for the previous year and increased by the aggregate of the remuneration paid or payable to all partners of the firm is such amount has been deducted while computing the net profit.
Salary Allowed
a. On the first 3,00,000 of book profits or in case of a loss ..........
Rs. 1,50,000 or at the rate of 90% of the book profit (whichever is higher)
b. On the balance of book profits ................ at the rate of 60%
The computation of Book Profit for the purpose of Section 40b would be the net profit as shown in the P&L A/c for the previous year and increased by the aggregate of the remuneration paid or payable to all partners of the firm is such amount has been deducted while computing the net profit.
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