Claiming of interest and remuneration

Tax queries 190 views 2 replies

Guest

A firm (eligible for 44AD) is not opting for 44AD has income above 8%.(turnover 1000000 , profit 100000)

However, after interest and remuneration, it is a loss.[100000profit -12000interest -150000 remuneration=(62000)loss]

[Due to omitting of the proviso to section 44AD(2) the salary and interest paid to its partners shall not be allowed to be deducted from the income computed under sub-section (1) of section 44AD.]

Will this loss be allowed? or will the firm be forced NOT to claim the interest and remuneration?

Replies (2)

gopal

future smart stupid

293 Points Joined October 2016

I had already discussed this. You can go to my profile and check for "Stupid"s question".

Still...

Firm is not eligible for claiming that remunarretion or interest under 44AD.

Guest

In the case I have mentioned, the book profit of the firm is well above 8%. Can we claim interest and remuneration such that the net income of the firm is 8% exactly?

Kindly note that we are not opting for 44AD. (we will use ITR 3 not ITR 4 sugam). We want to avoid the situation where audit will be necessary due to income falling below 8%