Tax on profit sharing
This query is : Resolved
07 May 2013
suppose I am partner of a firm & the net profit before taxis Rs,50 lacs, how much Income Tax I have to pay,& profit sharing ratio is 50-50,can i again have to pay Income Tax after dividing Profit.Please guide me.
07 May 2013
The net profit is before interest on capital n partners remuneration or not not disclosed by you...if it is b4 then provide it as partnership deed and on balance amount the firm has to pay tax at flat 30%...again it is exempt in the hands of individual partner.
Regards,
Neha Chauhan
Regards,
Neha Chauhan
Message likes :
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07 May 2013
if the Net Profit before interest on capital is Rs.2 lac & partners remunerations is is Rs.5 lacs each the how much tax i have to pay.
07 May 2013
you have to pay tax on Rs.43 Lacs
and there will be no tax on the shares of partner in this amount (i.e. Rs.43 Lacs)
but Rs.2 Lacs Interest & Rs.5 Lacs Remuneration
on this amount partners have to pay tax
and there will be no tax on the shares of partner in this amount (i.e. Rs.43 Lacs)
but Rs.2 Lacs Interest & Rs.5 Lacs Remuneration
on this amount partners have to pay tax
07 May 2013
If Net profit before interest is 2 lakh then u have to provide interest on capital at the rate prescribe in ur partnership deed and balance amount is treated as partners remuneration which is equally divided for both partner...in this situation the partnership firm have not to pay tax as the profit is NIL and partners are liable to pay tax on interest amount and remuneration amount at the rate applicable to them...kindly note that you can not provide remuneration more than prescribe in income tax act..it is limited to ur profit amount
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