Section 40(b)
This query is : Resolved
03 December 2009
1- Status- Firm
2- No of Partners- Two
3- Total Capital on 01.04.08- Rs. 10,00,000
4- Profit bfor intt.on capital & remun.
Rs. 1,42,000 upto 31.12.08
5- One partner retire from the firm on
31.12.08
6- Remaining one partner continue the
business.
Calculate Interest on Capital,
Remuneration allowable U/S 40(b)
& taxable profit of the firm on
31.12.08
2- No of Partners- Two
3- Total Capital on 01.04.08- Rs. 10,00,000
4- Profit bfor intt.on capital & remun.
Rs. 1,42,000 upto 31.12.08
5- One partner retire from the firm on
31.12.08
6- Remaining one partner continue the
business.
Calculate Interest on Capital,
Remuneration allowable U/S 40(b)
& taxable profit of the firm on
31.12.08
03 December 2009
1) Interest on capital @ 12% for 9 months= Rs.90,000/-
2) Remuneration:-
net profit 1,42,000/-
Less: interest 90,000/-
---------
Book profit 32,000/-
=========
3) Remuneration 32,000/-
4) Taxable income NIL
PROVIDED THE INSTRUMENT OF PARTNERSHIP CONTAINS PROVISIONS TO THIS EFFECT. IF NOT THE CALCULATION MAY BE IGNORED.
2) Remuneration:-
net profit 1,42,000/-
Less: interest 90,000/-
---------
Book profit 32,000/-
=========
3) Remuneration 32,000/-
4) Taxable income NIL
PROVIDED THE INSTRUMENT OF PARTNERSHIP CONTAINS PROVISIONS TO THIS EFFECT. IF NOT THE CALCULATION MAY BE IGNORED.
03 December 2009
Yes there is a mistake.Book profit is corrected as Rs.52,000/-
Remuneration is Rs.50,000/-
Taxable income Rs.2000/-
Mistake is regretted.
Remuneration is Rs.50,000/-
Taxable income Rs.2000/-
Mistake is regretted.
03 December 2009
whether it will remain firm at the end of the year (STATUS).
as as single person is operating the business?
and what about remuneration if there is no partnership at the end of the year? whether section 40b will be applied?
as as single person is operating the business?
and what about remuneration if there is no partnership at the end of the year? whether section 40b will be applied?
03 December 2009
Hi Mr. Zeeshan
In my opinion status wud changed bcauz it has become a proprietorship concern.
No. Sec 40(b) wud not apply.
In my opinion status wud changed bcauz it has become a proprietorship concern.
No. Sec 40(b) wud not apply.
03 December 2009
Remuneration is not based on months it is based on profit. and after 31st December it is will become proprietorship.
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