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Applicablity of section 40(b) of i.t. act
WHETHER INTEREST ON CAPITAL & REMUNERATION TO PARTNERS OF A PARTNERSHIP FIRM WILL BE ELIGIBLE FOR DEDUCTION, IF TAX-AUDIT U/s. 44AB IS MADE FROM A.Y. 2017-18 WITHOUT ANY LIMIT OF GROSS RECEIPT / TURNOVER
Replies (1)
I understood that you are enquiring about deduction in the hands of the firm.
In case of remuneration:
Only that paid to working partner and not other partners
It should be authorised by partnership deed and with in that it is calculated as below
on first 300,000 book profits - 150,000 or 90%of book profits whichever is higher and on the balance books profits - 60% is allowed,
In case of interest on capital:
It should be authorised by partner ship deed
and upto 12% only firm can get the deduction.
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