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Taxation in a company


Mukesh Bajaj   24 January 2020

Mukesh Bajaj

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how much income tax is charged on the directors , as they get salary? as my concern is that in a sole proprietorship the owner pays the tax as per the profits earned by the firm in a financial year , how it goes in a company ?

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Roshni (Studwnt)     24 January 2020

Roshni
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Normal slab rate applies. however TDs had to be deducted under sec 192

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Kapadia Pravin   24 January 2020

Kapadia Pravin

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In a Company both Company and Directors are different entities.

A Director getting salary is in capacity of an Employee. It's Salarexpenditure for Company.

Whereas in proprietory company, both proprietor and owner are same.

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Mukesh Bajaj   24 January 2020

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So the profit of the company is considered the income of directors ? and they are liable for taxes ?

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Roshni (Studwnt)     24 January 2020

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Director gets a fixed pay...profit of company is of shareholders.

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SIVASIVA (FCA, Future CA)     24 January 2020

SIVASIVA
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Director in a company will have to pay taxes on Salary income plus Capital gains income from sales of his shares if any plus other Gifts/Incentives covered under 'Income from other sources'

For sole prioprietors, it is taxed under 'income from business'.   

TDS will play a major role for Director's while submitting returns.  


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