Drafting partnership deed - salary clause ?
This query is : Open
18 August 2017
Hello
Let say if you using below clause for remuneration, is it still required to specify a figure for salary to working partners?
"The remuneration payable to the working partners above shall be credited to their respective accounts on ascertainment of book profits. The total remuneration/bonus shall not extend as per the limits laid down under clause 5 of section 40 (b) of the I.T. Act 1961 , and the above calculation of the remuneration is also subject to variation, if any changes made under clause 5 of section 40 (b) of the Income Tax Act , 1961."
Let say if you using below clause for remuneration, is it still required to specify a figure for salary to working partners?
"The remuneration payable to the working partners above shall be credited to their respective accounts on ascertainment of book profits. The total remuneration/bonus shall not extend as per the limits laid down under clause 5 of section 40 (b) of the I.T. Act 1961 , and the above calculation of the remuneration is also subject to variation, if any changes made under clause 5 of section 40 (b) of the Income Tax Act , 1961."
18 August 2017
Seems insufficient. Please see CBDT Circular 739 dated 25.3.1996 and finalize the remuneration clause accordingly.
18 August 2017
I found the circular here
http://incometaxindia.gov.in/Communications/Circular/910110000000000020.htm
Now only 60%of profit is allowed as total salary that can be withdrawn , so how can we decide how much salary should be withdrawn in the deed at the start of FY? Can someone help me in drafting the deed please.
http://incometaxindia.gov.in/Communications/Circular/910110000000000020.htm
Now only 60%of profit is allowed as total salary that can be withdrawn , so how can we decide how much salary should be withdrawn in the deed at the start of FY? Can someone help me in drafting the deed please.
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