Drawings

 

In case of Individual, drawings are reduced from the capital in balance sheet. I would like to know that  what will be the treatment of Drawings in case of company. [Thanks in Advance]
Replies (1)

a company is a legal entity seperate from its members............since drawings r done by individual and in case of company, directors are the individuals, and the directors can't take the money out of the company in anyway, specific provisions r made in the company Act and if so, company can give directors money by only as a loan..........moreover in this regard, income tax deems payment of such amount to be deemed dividend and levy 1/3rd tax rate on it................

drawings r done in case of individual proprietorships and firms by its partners.......

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