I want to ask about the case - when a partnership firm is having profit of rs 75000 before providing remuneration and interest but after all allowable expenses then is tax chargeable if partners remuneration equals to book profit.Or we have to take (net profit - Int. on capital)*90% as permissible remuneration and do computation accordingly? I am of opinion that no tax will be liable but have doubts so wants to clear.Thanz in advance for helping.
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Taxable income of partnership firm
Replies (2)
Book profit will be computed on the basis of Profits after Interest on capital.
Maximum Rem.: (Profits-Interest)*90%
But Remeber Interest is allowable only if provided in Partnership deed & Upto 12%
Thanz bro that is understood. My question is if my inome is below rs 150000 which I mention above that say rs 75000. in partnership also provided for remuneration.then this entire rs (75000-int on cap.) will be allowabe as remuneration or I have to take 90% of (75000-int on cap.)Because as per mine opinion if 150000 or 90% of bookprofit whichever is higher and minimum seems rs 150000. so I will deduct whole amount from (75000-int on cap).
Secondly can we carryforward the rest remuneration if left (150000 - (75000-int on cap.) as business loss, or as in actual we dont have earned above rs (75000-int on cap.)so taxable profit become nil and nothing carryforward. Kindly any expert or any body can some put light on it.
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