TDS u/s 192

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Yasmin Salim Shaikh (Querist)
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31 August 2009 If a partnership firm pays salary to its partners, then is it liable to deduct tax at source on such salary paid or credited?

CA CS CIMA Prakash Somani

CA CS CIMA Prakash Somani (Expert)
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31 August 2009 No There is no applicability to deduct TDS on Remuneration paid to partner, Since this income is taxable to Partner under the Head Business or Profession.

Yasmin Salim Shaikh

Yasmin Salim Shaikh (Querist)
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31 August 2009 Thank u Sir for the instant reply

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CP Ram

CP Ram (Expert)
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31 August 2009 Salary payment to partners is not covered under section 15 of the Income Tax Act, 1961.

This is because, there is no employer and employee relationship between the firm and partners.

Partners are the owner of the firm.

In view of the above TDS u/s 192 is not applicable to salary to partners.