Escolar Documentos
Profissional Documentos
Cultura Documentos
TAXATIONOFINCOMEOFPARTNERSHIPFIRM
Learn
Accounts
BA S IC A C CO U NT I NG
IN C O ME TA X
TAL LY
SALE S T A X/ V AT
Home>IncomeTax >TAXATIONOFINCOMEOFPARTNERSHIP
FIRM
TAXATION OF INCOME OF
PARTNERSHIP FIRM
PostedByG.S.Bansal,OnAugust15,2012
OT H ER S
BLOG TRAFFIC
Search:
Go
http://www.letslearnaccounting.com/taxationofincomeofpartnershipfirm
1/10
8/13/2016
TAXATIONOFINCOMEOFPARTNERSHIPFIRM
2/10
8/13/2016
TAXATIONOFINCOMEOFPARTNERSHIPFIRM
Remuneration Allowed
Maximum of
Rs.150000/=
Illustration:
For Financial Year 2016-17, the prot and loss account
of M/s XYZ Enterprises shows net prot of Rs.100000/=
after booking the salary to partners for Rs.500000/=.
The rm also paid interest on capital in excess of 12%
Rs.50000/=. Calculate net taxable income of Firm.
Solution:
a) Calculation of Book Prot
Net Prot of Firm after booking
the remuneration of partners
Rs.100000/=
Rs.500000/=
Rs.50000/=
3/10
8/13/2016
TAXATIONOFINCOMEOFPARTNERSHIPFIRM
excess of 12%
Book Prot
Rs.650000/=
Rs.270000/=
Rs.210000/=
Rs.480000/=
Rs.650000/=
Rs.480000/=
Rs.170000/=
http://www.letslearnaccounting.com/taxationofincomeofpartnershipfirm
4/10
8/13/2016
TAXATIONOFINCOMEOFPARTNERSHIPFIRM
5/10
8/13/2016
TAXATIONOFINCOMEOFPARTNERSHIPFIRM
Illustration:
Net prot of M/s X Y Enterprises for nancial year
2016-17 after providing the interest on capital and
remuneration to partners, is Rs.76000/=. The rm has
two partner namely Mr. X and Mr. Y. Capital of Mr. X is
500000/= and Capital of Mr. Y is Rs.300000/=. The rm
has paid the interest on their capital @ 15% per
annum i.e. Rs.120000/=. Both are the working partners
of the rm and are entitled for equal share in income
of the rm. The rm has paid a remuneration of
Rs.200000/= to each partner.
Calculate (a) income tax amount of rm and (b)
income of partners from partnership rm
Solution:
To solve the above illustration, we have to follow the
following steps to understand it in easy way. Though,
there may be dierence in presentation of gures by
dierent people but the result will be same.
a) Amount of Interest to be allowed by rm as per
income tax act:
Partners
Name
Capital
employed
Mr. X
Rs.500000/=
Mr. Y
Total
InterestPaid
@ 15%
Interest
allowed @
12%
Interest
disallowed
Rs.75000/=
Rs.60000/=
Rs.15000/=
Rs.300000/=
RS.45000/=
Rs.36000/=
Rs.9000/=
Rs.800000/=
RS.120000/=
Rs.96000/=
Rs.24000/=
RS.76000/=
6/10
8/13/2016
TAXATIONOFINCOMEOFPARTNERSHIPFIRM
Rs.24000/=
Rs.400000/=
Book prot of rm
Rs.500000/=
RS.270000/=
Rs.120000/=
Rs.390000/=
Rs.10000/=
Rs.76000/=
Rs.24000/=
Rs.10000/=
RS.110000/=
Rs.33000/=
Rs.660/=
Rs.330/=
http://www.letslearnaccounting.com/taxationofincomeofpartnershipfirm
7/10
8/13/2016
TAXATIONOFINCOMEOFPARTNERSHIPFIRM
RS.33990/=
Allowed
Remuneration
from rm
Allowed Interest
on capital
Total taxable
income from
rm
Mr. X
Mr. Y
Rs.195000/=
Rs.195000/=
Rs.60000/=
Rs.36000/=
Rs.255000/=
Rs.231000/=
8/10