Hello Sirs
We are a private limited company, jointly owned by my brother and me, with each of us holding 50% of the shares. While I am the director responsible for managing the business, my brother is a silent partner with no involvement in operations. However, since January 2009, he has been receiving a salary of ₹1 lakh per month. Over 192 months (from January 2009 to February 2025), he has consistently withdrawn his salary.
For personal reasons, I have not taken any salary during this period, despite managing and running the business. After discussing the matter, my brother and I have agreed that I should receive my unpaid salary of ₹1 lakh per month for 192 months, along with 5% annual compound interest on the outstanding amount.
The company has never declared dividends and currently holds approximately ₹3.5 crore in fixed deposits. Given this, what would be the most tax-efficient way for me to receive my unpaid dues? My brother and I remain in complete agreement and continue to be partners in harmony.
Thank you in advance for any help/advice you may be able to provide. I truly appreciate it.
CAclubindia
