Salaries to partners in partnership firm - regarding
This query is : Resolved
17 April 2012
Dear Sir/Madam,
i would like to know the information about partners salaries on which basis and interest on partners on which basis how much percentage (%) in partnership firm what is the way to calculate these two things kindly solve my query send me to my email address many thanks to all
With best Regards
venkat
venkatseven@yahoo.com
i would like to know the information about partners salaries on which basis and interest on partners on which basis how much percentage (%) in partnership firm what is the way to calculate these two things kindly solve my query send me to my email address many thanks to all
With best Regards
venkat
venkatseven@yahoo.com
11 May 2012
1. Salaries and interest to partner shall be as per the partnership deed.
2. For income tax purpose, Section 40(b)(v) will have to be followed and maximum remuneration allowable will be calculated as under:
On the first Rs. 3 lakh or in case of loss - Rs. 1,50,000/- or 90% of book profits.
On the balance of the book profit - 60%
Book profit shall be computed after adding back salaries and interest paid to the parthers.
Further, interest paid to partners in excess of 12% shall be disallowed.
2. For income tax purpose, Section 40(b)(v) will have to be followed and maximum remuneration allowable will be calculated as under:
On the first Rs. 3 lakh or in case of loss - Rs. 1,50,000/- or 90% of book profits.
On the balance of the book profit - 60%
Book profit shall be computed after adding back salaries and interest paid to the parthers.
Further, interest paid to partners in excess of 12% shall be disallowed.
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