Partnership Firm Tax Return Filing

A registered partnership firm may be a partnership that has been registered with the Registrar of Firms and has received a registration certificate for an equivalent . Any partnership firm that doesn’t have a registration certificate from the Registrar of Firms is an unregistered partnership.

Partnership firm is looked upon as a separate entity. it’s immaterial that partnership is registered or not registered. So partnership firm is taxes under the tax slab for partnership firm and partners are taxed under the tax slab for people.

1. Long-term Capital Gain 20%

2. Short-term financial gain u/s 111A 15%

3. Other Income 30%

➼ Surcharge of 12% where taxable income including capital gains exceeds Rs.1 crore is subjected to marginal relief If the firm has a net of exceeding Rs.1 crore, the quantity payable as tax and surcharge shouldn’t exceed the entire amount payable as income-tax on total income of Rs.1 crore by quite the quantity of income that exceeds. Rs.1 crore.

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➼ as per section 115 JC of the tax act, The Alternate minimum tax payable by the Partnership firm can’t be but 18.5% of adjusted total income.

While calculating the tax applicable for a partnership firm, it’s to be noted that Under an tax , the subsequent sort of expenses paid by the partnership firm to the partners isn’t considered as deductions:

➼ Salary, bonus, commission or remuneration paid to non-working partners.

➼  Remuneration or interest paid to the partners which aren’t in accordance with the terms of the partnership deed.

➼ Remuneration or interest paid to the partners is in accordance with the terms of the partnership deed but they belong to the amount before the date of formation of the partnership deed.

Apart from the above conditions, the interest paid to partners should be within the conformity with the terms of the partnership deed and will not exceed 12% once a year . Also, remuneration paid to partners should be consistent with the terms of the partnership deed and will not exceed the subsequent permissible limit:

➼ On first Rs. 3 Lakhs of book profit or within the case of loss – Rs. 1,50,000 or 90% of book profit, whichever is more.

➼  On the balance of the book profit – 60% of book profit.