Check sibling questions

Presumptive income schemes of 44AD , 44ADA and 44AE are also applicable to partnership business

However, if these schemes claimed, then we cannot claimed deductions for partners salary and interest

 

Q1  
Suppose a Partnership firm has turnover of 80 lacs ( 20 lacs cash rest in bank)
What is its business Income
How much Income tax he is payable by it?

Answer

Particulars CASH BANK TOTAL
TURNOVER 2000000 6000000 8000000
PROFIT % 8% 6%  
PROFIT 160000 360000 520000

 

   
PROFIT  520000
TAX 156000
SURCHARGE 0
TAX+SURCHARGE 156000
CESS 4% 6240
TOTAL TAX+CESS 162240

 

Q2

Can it pay Interest and Salary to Partners to reduce its tax liability?

Answer

Yes in f.Y 2015-16
If we are claiming 8%,6% profit ,we cannot claim deductions for different expenses under Section 30 to 38.
But we  can claim other deduction like Section 40 (b) Deduction for partners.

 

No from F.Y 2016-17 onwards till date
If we are claiming 8%,6% profit ,we cannot claim deductions under Section 30 to 38.
and we also cannot claim other deduction like Section 40 (b) Deduction for partners.

 

 

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CA Maninder Singh

CA Maninder Singh is a Chartered Accountant for the past 12 years. He also provides Accounts Tax GST Training in Delhi and Kerala.