02 July 2010
Can the partners of a firm waive allowable remuneration in the event of a loss even if the partnership deed provides that they shall be entitled to remuneration as per the Income Tax Act?
02 July 2010
As per Section 40(b) of the IT Act, it is not mandatiry to provide for partner's remuneration in the books. If in the partnership deed it is mentioned that remuneration to the partners will be paid as per Sec. 40(b) of the IT Act, then you need not provide for partners' remuneration in books. But, if it is expressly mentioned in the partnership deed, that in any case, partners are to be paid such and such remuneration, then you have to go by the partnership deed.
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