Plz Help
This query is : Resolved
10 December 2010
HI,
I want to know that how the company can use there reserves & surplus accumulated during previous years.
I mean if a Co Named XYZ private Limited having 2 Directors named X & Y. The Directors having a share Capital of rs 5lac each.Company transfer the profit of each year into the Reserve & Surplus a/c having a balance of (say)8lac.
Now the Director want to use the balance of Rs 8lac for there own purpose or for company purpose.
Now My question is whether director use these funds same as capital of directors just like partnership firms or there are some other provisions regarding the same.
Directors want some funds from company for personal purpose.
Kindly Help.
Thanks in Advance..
I want to know that how the company can use there reserves & surplus accumulated during previous years.
I mean if a Co Named XYZ private Limited having 2 Directors named X & Y. The Directors having a share Capital of rs 5lac each.Company transfer the profit of each year into the Reserve & Surplus a/c having a balance of (say)8lac.
Now the Director want to use the balance of Rs 8lac for there own purpose or for company purpose.
Now My question is whether director use these funds same as capital of directors just like partnership firms or there are some other provisions regarding the same.
Directors want some funds from company for personal purpose.
Kindly Help.
Thanks in Advance..
10 December 2010
Simply dont. If directors use the accumulated profit for their personal purpose and if their shareholding is 10% or more they will fall in the trap of Sec 2(22)(e) i.e. Deemed Dividend and any amount which they take for personal use will be added in their income and they will have to pay tax on that.
11 December 2010
sir.if company want to utilize these funds.
11 December 2010
For what purpose company wants to utilize these funds?
11 December 2010
Sir,
First of all thanks 4 ur valuable replies.
Sir i want to know for what purpose company can utilize these funds.The company which i am taking about, have 2 directors.Now they want 2 utilize these funds.I am the Internal Auditors of that Firm & dont have exact idea about this kind of problem.
Plz Help
Regards
First of all thanks 4 ur valuable replies.
Sir i want to know for what purpose company can utilize these funds.The company which i am taking about, have 2 directors.Now they want 2 utilize these funds.I am the Internal Auditors of that Firm & dont have exact idea about this kind of problem.
Plz Help
Regards
13 December 2010
Utilize these funds for expansion or if surplus funds make investments.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- GST on export of services and Input Credit
- ITC temporary reversal and reclaim
- Inventory of finished goods
- Applicable TDS rate for sale of property in Nov 2024
- Tds on building rent monthly
- RCM INVOICING FROM NOV-2024
- Should I report my US salary for January, February, March in Schedule FA?
- GST ON EXPORT COMMISSION
- Confusion around Form 26QB fields
- Adjustment entry in the case of Individual and HUF on 31st March
- Stock difference tax applicable on composite rate or normal rate
- LAST YEAR 2022-23 ITC IN NEXT YEAR 2023-24 REPORITNG IN GSTR-9
- MIS MATCH OF INVOICE NUMBER
- IGST Credit-Show cause notice issued-confusion
- Issue of gst e invoice
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
Trending Online Classes
CAclubindia
