25 August 2010
Sir, I wish to clarify one doubt i.e. M/s.Campus Solutions is a Partnership Firm & it has two partners & only one partner them getting a remuneration for Rs.20000 p.m.i.e Rs.240000p.a. Now firm has Net loss as per P & l A/c for Rs.50000. In this situation what is the income will be taxable in the hands of Partner? Actually he is getting Rs.240000. 1.Is it fully taxable in the hands of partner? or 2.any amount will be exempted ? or 3.The Partner's Remn Max permissible as per IT act will be affect the tax liability of Partner? 4.How it will affect? S.Jegadeesan
25 August 2010
Maximum permisible salary to be paid by firm is Rs. 150,000 in case of loss. Hence only Rs. 150,000 would be taxable and the same amount only will be allowable as an expense in the hands of the firm.
Also limit of Rs. 150,000/- only if the same has been amended in the partnership deed.
27 August 2010
Thanks for your information. Suppose the firm given Rs.300000 p.a. in this situation. What will be taxable income of the Partner? we have add Remuneration as per P & L then deduct Admissible as per IT Ac.This is for Firm. My question is What will be taxable in the hands of Partner? i.e.Whatever has been provided in the P & L A/c will be taxable in the hands of Partner?
27 August 2010
The amount of salary allowable as an expenses in the hands of the firm is taxable in the hands of the partner.
So if in the above case firm is allowed Rs. 150,000 as deduction as per Income Tax provisions taxable amount in the hands of the partner would be Rs. 150,000 only.
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