Can director of a pvt ltd company take personal fee?

Pvt ltd 1017 views 5 replies

bhargava

marketing

55 Points Joined February 2011

Hi,

My friend is a director in a pvt ltd company. He is into interior design and previously did freelance constation too. After becoming a directors can he still continue with his freelancing work and take the consultation fee in his personal account? Also few of his clients are now with his private limited company that he incorporated along with 4 others. Is it okay if he takes money from those clients too. The client want to pay him personally instead of a company for their own personal reasons. All payment is through check or bank transfer.

please guide

thanks

Replies (5)

Prabeer

B. COM (H) CA & CS Final

5484 Points Joined December 2007

The answer to all your queries is yes.

CA Maulik Rachh

114 Points Joined December 2011

YEs ,i think no issues on that.

bhargava

marketing

55 Points Joined February 2011

Originally posted by : Prabeer
	The answer to all your queries is yes.

Do the other director's of the company can claim a share in this personal income which he earns from freelancing?

Guest

Directors can not claim.

Vinod Venugopal

Practice

25 Points Joined July 2009

Facts of the case are as follows:

1, The company in question where the director holds office is a pvt limited company.

2. There are 3 other subscribers to the MoA of this pvt company who are his fellow directors on the Board.

Response:

The Director in question can continue with his freelancing work and take consultation fee in his personal account if both of the following situations are inapplicable to him:-

(a) He is an employee director of the private ltd co. who draws remuneration from the company.

(b) He is party to non - compete agrement with the company.

Thanks

Vinod