10 August 2009
Is it mandatory to give remuneration to each partner or selected partner can be given remuneration..or remuneration can be given to one single partner on behalf of other???
11 August 2009
Section 40(b) of the Income tax Act,1961 does not say that remuneration should be paid to all the partners. If all the partners are working partners, according to the partnership deed, remuneration to be paid to all of them. Otherwise it can be paid to the working partners,even if they are less than the total number of partners,according to the stipulation in the deed. However, what ever may be the factual situation, the partnership deed should contain, w.e.f assessment year 1996-97, the minimum remuneration, each partners share of remuneration and the method of quantifying the remuneration so as to get the deduction under section 40(b)(v).
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