Partner required for 10 yr old firm on fix basis

Hey Vikas! If you’re looking for a partner for your 10-year-old CA firm and want to offer fixed remuneration to a sleeping partner, here are a few things to keep in mind:

Key points for a sleeping partner with fixed remuneration:

• Sleeping Partner:
  Not involved in day-to-day operations, but shares in profits/losses as agreed.

• Fixed Remuneration:
  You can pay a fixed salary or remuneration as per your partnership deed.

• Profit Sharing:
  Decide if the sleeping partner will share profits in addition to fixed remuneration or only get fixed remuneration.

• Partnership Deed:
  Clearly specify the terms—remuneration, role, profit share, and duration.

• Tax Implications:
  Fixed remuneration paid to partners is generally allowed as a deduction for the firm, but ensure compliance with the Income Tax Act provisions related to partner remuneration.

A sleeping partner’s remuneration should be provided for in the partnership deed and must be for services actually rendered; merely being a partner does not establish entitlement. For tax deduction under section 40(b), the deed should specify the remuneration or a clear method of determining it, and the statutory limits and other conditions must be met. Review the firm’s deed and the partner’s role before fixing or changing the amount.

Agree and document any change through a supplementary deed, with effect from the stated date; avoid retrospective claims. The appropriate amount depends on the deed, the partner’s contribution and the firm’s profitability. For a partner opportunity, share the firm’s location, practice areas and proposed terms with the caller.

Fixing partner remuneration also calls for a clear deed, accounting and tax workflow. Manual practice work is difficult, and automation reduces repetitive work while professional judgment remains in control. At Jir AI, our 2,000+ AI agents and 650+ integrations streamline GST, ITR, TDS, TCS and other compliance workflows, helping reduce manual workload by up to 70%. For a more efficient compliance workflow, connect with us on WhatsApp: https://wa.me/message/3HVOZ7HIY4ESC1