Partners Renumeration
This query is : Resolved
14 December 2009
How partners renumeration is calculated if there are 2 partners having 50% share in profit each, in a partnership firm.
14 December 2009
On First Rs 3,00,000 of book profit or in case of loss,Rs 1,50,000 or at the rate of 90% of the book-profit, whichever is more.after On the balance of book profit,at the rate of 60%
14 December 2009
The instrument of partnership should necessarily contain a clause regarding payment of remuneration to partners. Such class should contain the method of quantifying the remuneration, minimum remuneration, maximum remuneration and the division of remuneratin among the partners. However the maximum remuneration allowable for income tax purpose is governed by section 40(b) of the Income tax Act,1961 which is explained the Mr. Murtaza.
15 December 2009
In my opinion, The Partnership agreement should contain the clause regarding remuneration payable to partners and the procedure for calculating the same.
15 December 2009
Remuneration of Partner from Apr 1,2010(Section 40(b)(v))
->Rs.3 lakh book profit or loss-Rs.1.5 lakh or 90% of book profit which ever is higher
->Balance book profit-60%
->Rs.3 lakh book profit or loss-Rs.1.5 lakh or 90% of book profit which ever is higher
->Balance book profit-60%
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