Indeterminate member shares trigger taxation of the association's total income at the maximum marginal rate. Tax is charged on the total income of an association of persons (other than a company or co-operative society) at the maximum marginal rate where individual member shares in the whole or any part of that income are indeterminate or unknown; the Explanation ties maximum marginal rate to the meaning in the Explanation to sub-section (3) of section 164 and deems shares indeterminate if unknown at formation or at any time thereafter.
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Provisions expressly mentioned in the judgment/order text.
Indeterminate member shares trigger taxation of the association's total income at the maximum marginal rate.
Tax is charged on the total income of an association of persons (other than a company or co-operative society) at the maximum marginal rate where individual member shares in the whole or any part of that income are indeterminate or unknown; the Explanation ties maximum marginal rate to the meaning in the Explanation to sub-section (3) of section 164 and deems shares indeterminate if unknown at formation or at any time thereafter.
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