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Interest on Partner Salary


24 March 2017 Is it mandatory to provide 12% interest on the capital of partners of a firm.??? in case the firm is newly opened and partners(2) have introduced 1 lakh each and both withdraw 1,50,000 during the year .In such case what will be the treatment of interest of capital??

25 March 2017 No, Interest on capital is not mandatory, if interest is given it should not more than 12% to claim allowable expenses from business.

25 March 2017 OK thanks for ur valuable answer




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