Treatment of partners remuneration

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This query is : Resolved

Karthik Kumar (Querist)

19 June 2018 As per Section 28(v) of the Act, Partners remuneration is treated as business income, so can partners opt for filing this income under presumptive taxation? if yes under section 44AD or 44ADA( i.e 8% or 50%)?

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

19 June 2018 44AD/ADA can be opted as the case may be.
Inference - Usha Narayanan Vs. DCIT TS-6853-ITAT-2013 (Kol).

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Karthik Kumar

Karthik Kumar (Querist)

19 June 2018 Sir, don't you think this would ruin the intention of the law? I mean to ask isn't it a loophole within the law?.. because there would be no expenditure for the partners and even if there are any they would claim it in the firm as expenditure.. so won't the partner take undue advantage of the provision by opting to pay tax on 8% or 50% of such remuneration?

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

19 June 2018 I endorse........................

KAVIRAJA ADDANGADI

KAVIRAJA ADDANGADI (Expert)

19 June 2018 Partners remuneration part is consider to be income, same can not be declared again under 44AD or 44 ADA, because same already Exps claimed by firm, full amount offered to tax,.

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