Itr3

Dear Santu,

As per sub section (b) of section 40, if all other conditions specified in this provision has been complied, maximum amount of remuneration which is allowed to be deducted from the profits and gains from business or profession of the firm is, in case of loss or upto INR 3,00,000 of book profit:- 1,50,000 or 90% of book profiit which ever is higher and for the balance profits 60% of the profits. Even if the firm pays or charges excess remuneration, that amount will be disallowed. Hence the firm is paying tax on the disallowed portion. Since the firm has paid tax on the disallowed portion of remuneration, partner need not to pay tax on the same amount. Hence what ever amount of remuneration has been allowed as expenditure of the firm, partner should have declare those amount in his income tax return and need to pay tax in accordance with the provisions of the Act.

Hope this clarifies your doubts, if not kindly elaborate your doubt.

Regards,

Hemanth Pullanikkat

Dear Mr. Hemanth,

I am very sorry to say you that you didn't get my point. I didn't said that partner need to pay tax on that Rs. 20,000/- amount because this is exempt in the hand of the partner. I asked that where the partner may declare this exempt income in ITR3?

Thanks,

Dear Santu,

Sorry for the misunderstanding and thanks for your clarification.

The Form ITR-3 has been divided into two parts.Part A mainly seeks general information requiring identificatory and other data.Part B requires details of income followed by schedules.

As per the instructions to Form ITR 3 released by department, any amount of Salary, bonus, commission or remuneration and interest on capital received by the assessee from the firm can be mentioned in row number 3 of Part B of the form. Further, details of these amounts can be mentioned in Scehdule BP appended to the form. Besides, details of the firm in which the assessee is a partner must be given in Schedule IF.

Hope this subsides your doubts.

Regards,

Hemanth Pullanikkat.

Mr. Hemanth,

Again I am saying you sorry till now you didn't get my point. Schedule BP is only for taxable income declaration. This is not the part of exempt income. Where the partner declare his exempt income which Rs. 20,000/- which exempt in the hand of the partner because firm already paid tax on that amount?

Question is on:-

Rs. 20,000/- exempt income where he(partner) can able to declare in ITR3?

There is a schedule EI, in which it can be declared in point no. 5 other exempted income.

Mr. Saurabh Kumar,

Ok now got the point. This is the answar what I am looking for. Thank you Mr. Saurabh Kumar.

And also thanks to Mr. Hemanth.

What expenses can be deduct in expenses in relation to IV ?

Schedule BP		Details of Income from Firms of which partner
FIRMS	Firm PAN. (From Schedule-IF)	Salary, bonus, commission or remuneration received from the firm	Interest received from the firm on the capital	Total ii + iii	Expenses in relation to iv	Net Income iv - v
Sr no	i	ii	iii	iv	v	vi
1		0	0	0	0	0
2		0	0	0	0	0
3		0	0	0	0	0
4	Total	0	0	0	0	0
(Do not delete blank rows)
5	Deduction, if any, for payment of any sum for carrying out and eligible project of scheme as per section 35AC
6	Net Income from Business [4(vi) – 5]					0
NOTE	Please include the income of the specified persons referred to in Schedule SPI while computing the income under this head

Is it tax free remuneration or tds has been deducted??

Is it tax free remuneration or tds has been deducted??