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Sec.40A(2)(b)-Payments to Relatives
@ prashant jain:
relative is defined u/s 2(41) of the income tax includes"spouse of the assessee ,brother sister,or any lineal ascendent or descendent of the individual"
leneal ascendent :father, mother,grend father,grand mother,great garn father, great grand mother
leneal descendent:son,daughter,grand son,grand daughter,great gand son,great grand daughter
How can i know a person is a relative or not.
If we know the persons relatives then we can proceed, even though we know that the transactions with relatives we have to take an acknowledment from clien other that those specified(if any), no other transaction is made with relatives
| Income Tax u/s 40A(2)(b) | |
| In relation to section 40A(2)(a) the parties are as follows: | |
| (a) | where the assessee is an individual-any relative of the assessee |
| (b) | where the assessee is a company, any director of the company or any relative of such director. |
| (c) | any individual who has a substantial interest in the business or profession of the assessee, or any relative of such individual |
| (d) | a company having a substantial interest in the assessee or |
| any director of such company or any relative of such director | |
| or any other company carrying on business or profession in which the first mentioned company has substantial interest; | |
| (e) | a company of which a director has a substantial interest in the assessee; or any director of such company or any relative of such director |
| (f) | any person who carries on a business or profession |
| -where the assessee being a company, or any director of such company, or any relative of such director has a substantial interest in the business or profession of that person | |
Is the entire expenditure disallowed or only the amount which is in excess of the fair market value of the goods, services or facilities disallowed u/s 40A(2)(b)?
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