Soumya Laha (Advocate & Tax Consultant) (4698 Points)
20 September 2021Can a Partner take lower remuneration from firm than prescribed rate (by Income Tax) ?
For example, a Partner take remuneration at the rate of 30% on first 3 lakh of Book Profit of the firm. But on rest balance of book profit, the partner receive remuneration at the rate of 10% instead of 60% rate prescribed by Income Tax Department. Is it allowable ?
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177227 Points)
Replied 21 September 2021
Yes. The rates prescribed in the act are for MAXIMUM allowable deduction for the firm.
But the same should have been incorporated in the DEED.
Excel Mastery Program
CAclubindia
