SALARY TO PARTNER

IF A WORKINGPARTNER DRAWING SALARY FROM THE FIRM , (SINCE THE SALARY  OF PARTNER IS TREATED AS BUSINESS INCOME )SHOULD THE FIRM DEDUCT TDS ON SALARY , AND WHAT ABOUT PROVIDENT FUND WHETHER IT IS ALLOWED TO DEDUCT PF IF THE PARTNER WILLING TO CONTRIBUTE  PLEASE CLARIFY 

Replies (19)

TDS is not deducted for interest and salary paid / credited to the partners by the firn. PF is also no tapplicable for partners salary

Originally posted by :G.E.Sudarsan
" TDS is not deducted for interest and salary paid / credited to the partners by the firn. PF is also no tapplicable for partners salary "

TDS is not applicable to salary to partners salary as the section specifies the term as "any income that is chargeable under the head salaries". As partners salary is chargeable under the head Profits and Gains of Business and Profession, the firm is not liable to deduct tax at source on salaries.

 

Moreover, the provisions of PF and ESIC are also not applicable on such payments.

thanks everybody

 no tds to be deducted on salary 2 partner &interest to partner as they r nt chargeable under head salary of partner

Originally posted by :kabirsen
"  no tds to be deducted on salary 2 partner &interest to partner as they r nt chargeable under head salary of partner "

 

Correct.

There is no employer employee relationship between the partner and partnership.

There is a CBDT circular that TDS need not be deducted on interest on capital credited to partners' accounts. If any one can produce that here, thanks.

 No TDS

Agree with all the views.

Employer employee relationship doesnot exist in case of partner so don't deduct TDS. Provision of PF is not applicable on such payment.

 

 

Employer employee relationship doesnot exist in case of partner so don't deduct TDS. Provision of PF is not applicable on such payments

thank u amol ji....

tds is not applicable in case of salary or intt. paid to parters of a firm because partner's salary income is taxable u/s 28  under the head "income from bussiness & profession"

tds is not applicable in case of salary or intt. paid to parters of a firm because partner's salary income is taxable u/s 28  under the head "income from bussiness & profession"

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