Tax planning for directors remuneration

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

02 August 2011 Dear All,

How are you?

Can any one tell me how to plan for maximum tax savings on Directors Remuneration.

Whether all tax benefits, deductions, exemptions applicable to salaried employees are also applicable to Directors or not?

Can any one please give guidance.

Please send the details to my mail id: swamykarlapudi@gmail.com, if possible.

Thanking you,
Swakar.

Amol Gopal Kabra (CA,CS,DISA)

Amol Gopal Kabra (CA,CS,DISA) (Expert)
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02 August 2011 If the directors are shown as employees, then these are applicable. If they are shown as professional, then you can pay them professional fees. It will depend upon case to case.

Querist : Anonymous

Querist : Anonymous (Querist)

03 August 2011 Thank you Mr.Gopal gi.

If we treat them as employees for deducting tds u/s 192B, so we can give all benefits available under salary income provisions under IT Act. (Like HRA etc). Some experienced person advised to give only 80C max limit and to deduct tax on entire amount by applying average rate of tax. How far his statement is correct. Could you please provide any notification/case law/specific reading on Director remuneratin.

If we treat them as professionals for deducting tax, can they claim professional expenses as deduction from gross remuneration received.

In TDS point of view, this treatment as professional is better for lower deduction of tax. Can I do so like?

Thanking you once again...
Swamu.

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