Professional charges can be paid to directors relatives

Professional Charges Can be Paid to Directors relatives like wife or mothers, and what is the law of income tax regarding this

Read more at: /forum/create_message.asp?cat_id=3

Replies (1)

Yes. Professional charges can be paid to the relatives of the directors. But it has to be within the perview of sec. 40A(2)b of The IT Act. As per sec 40A(2)b:

 

The expenses for which payment has been made to a relative or a person with substantial interest shall be disallowed when –

  • These expenses are incurred for goods, services or facilities.
  • Payment has been made to a relative or a person with substantial interest as defined above.
  • Such expenses are excessive or unreasonable. They are not in line with fair market value. Or they may not be a legitimate need of your business & profession. Or when you have incurred these expenses and they result in a benefit to you. Do note that an Assessing Officer can disallow expenses when they are not in sync with the needs of your business, even though these may have been paid as per the market value.

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
25 August 2026
Senior Accountant

MG Associates

New Delhi

CA Inter

View Details
Company
09 September 2026
Chartered Accountant

Aviv Global Private Limited

Ahmedabad

CA

View Details
Company
ARTICLESHIP 01 September 2026
Article Assistant

SGNG & Associates

New Delhi

CA Inter

View Details
Company
ARTICLESHIP 26 August 2026
Article Assistant

ANIVESH CONSULTANTS LLP

Gurgaon

CA Inter

View Details
Company
ARTICLESHIP 25 August 2026
CA Article's

Saini Pati Shah & Co LLP

Mumbai

CA Inter

View Details
Company
27 August 2026
ACCOUNTANT

CHARUPREETI & CO

Noida

Graduate (Any)

View Details
Company
ARTICLESHIP 17 August 2026
Article Assistant

Jain Ankit and Co

Gurgaon

CA Inter

View Details
Company
ARTICLESHIP 07 September 2026
CA Articles

Kothari Jain Patil & Chartered Accountants

Pune

CA Inter

View Details