SALARY TO DIRECTOR
This query is : Resolved
Omkar Gijare
(Querist)
29 September 2010
Whether any limit to pay salary to directors as per corporate law? And also advice is it fully allowable under income tax act?
Ajay Mishra
(Expert)
29 September 2010
Payment of Managerial Remuneration
The total managerial remuneration payable by apublic company to its directors or manager in respect of any financial year shall not exceed 11% of the net profit of the company for that financial year computed in manner laid down in section 198(1) of the Companies Act, 1956.
Remuneration payable to MD or WTD shall not exceed 5% of the net profit for one such director and if there is more than one such director, 10 % for all of them together.
The provision of managerial remuneration will not apply to private limited company.
Regards
CS Ajay Mishra
Payment of Managerial Remuneration
The total managerial remuneration payable by apublic company to its directors or manager in respect of any financial year shall not exceed 11% of the net profit of the company for that financial year computed in manner laid down in section 198(1) of the Companies Act, 1956.
Remuneration payable to MD or WTD shall not exceed 5% of the net profit for one such director and if there is more than one such director, 10 % for all of them together.
The provision of managerial remuneration will not apply to private limited company.
Regards
CS Ajay Mishra
Hemu Kapoor
(Expert)
29 September 2010
Agree with AJAY SIR
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