Non-compliance with section 325 bars firm deductions for partner payments and thereby removes partner taxation. Where a firm does not comply with the provisions governing payments to partners, no deduction shall be allowed to the firm for any payment of interest, ... Summary
Non-compliance with section 325 bars firm deductions for partner payments and thereby removes partner taxation.
Where a firm does not comply with the provisions governing payments to partners, no deduction shall be allowed to the firm for any payment of interest, salary, bonus, commission or remuneration to a partner when computing income under the head "Profits and gains of business or profession", and such payments shall not be chargeable to income-tax in the hands of the partners.
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