CA rohit swami (CHARTERED ACCOUNTANT) (262 Points)
30 April 2013CAN ANY ONE PROVIDE ME INFORMATION REGARD MAXIMUM DIRECTOR REMUNERTION LIMIT IN PVT. LIMITED COMPANY , HOW MUCH MAXIMUM REMUNERTION CAN PVT. COMPANY PAY TO DIRECTORS( PLZ TELL ME ONLY PVT. COMPANY PROVISON)
CA rohit swami
(CHARTERED ACCOUNTANT)
(262 Points)
Replied 30 April 2013
THEN COMPANY DIRECTOR CAN RECEIVE UNLIMITED AMOUNT OF REMUNERATION .IF THEY PASS A RESOLUTION FOR INCREASE OF REMUNERATION.
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 30 April 2013
Mr. Rohit,
Kindly appreciate strict provisions related to managerial remuneration are not applicable to a private limited company. However I would suggest you to check the provisions of your AOA in this regard. Subject to the provisions of your AOA you are free to give remuneration to your director.
By passing a board resolution you can fix/revise remuneration of your directors in private company.
Thanks
Prashanth S K
(Practice)
(148 Points)
Replied 30 April 2013
Pawan Mittal
(CA Final)
(711 Points)
Replied 04 May 2013
Dear Rohit,
Section 309 of Companies Act imposes restrictions on the payment of remuneration ot the directors but it is applicable only on the public companies.
No restriction on private companies has been specified.
poonam verma
(Company Secretary)
(191 Points)
Replied 06 June 2013
Section 198,269, schedule XIII, 309, 310 are not applicable to pvt. company. Pvt. Co. has to check the provisions of AOA of the Company in this matter. However wahtever is to be paid should be reasonable and justified by the profits of the company.
Sanjeev Kumar
(CEO KPS Corporate Consultants P LTD )
(99 Points)
Replied 29 October 2013
Agree with answers already in the record.
The provisions of companies Act, 1956 or for that matter of the companies act 2013 with respect to managerial remuneration or computation of net profits for the purpose of managerial remuneration, the limitations placed etc.; does not apply to the private limited companies as such. However in case the private limited company is a subsidiary of a public limited company the above said provisions applies.
Tushar Patil
(CA Practice )
(35 Points)
Replied 13 April 2014
Then how much amount will be remuneration to directoers of private company will be allowable for Income Tax Purpose?
Prashanth S K
(Practice)
(148 Points)
Replied 18 April 2014
As far as the expenditure satisfies the commercial expediency of that particular business there wont be any problem in the allowability of remuneration. As far as the revenue is concerned, the same remuneration is going to be admitted as income by the director and revenue in the form of tax is going to be received by them. Sec 40A(2)(b) of the act prescribes the disallowance of any excessive or unreasonable expenditure. But it is not a an automatic disallowance. Only when the A.O is of the opinion that the same is excessive or unresonable disallowance comes into picture. Sec 194 J covers in its ambit Director's Remuneration and if TDS is not deducted the same will be disallowed.
Pooja Kanania
(Audit Executive)
(204 Points)
Replied 21 March 2015
Kindly mention the section from Companies Act 2013, where i can get the detailed information about remuneration to directors of a private co., public co...
Sonam Malkotia
(Trainee)
(36 Points)
Replied 30 May 2015
Harshal Sheth
(...)
(29 Points)
Replied 04 September 2015
What if nothing is mentioned in AOA of a private limited company? is it required to put a clause in the AOA in respect of ceiling limit of Directors remuneration?
Rahul Mishra
(Accounts Head)
(37 Points)
Replied 01 January 2016
If remuneration paid to director is in the nature of salary, then TDS will be applied as per section 192 and not 194J (1) ba, Please correct me if I'm wrong.
CAclubindia
