Admissibility of deduction on account of salary/interest to partners of firms opting for estimation of income under sections 44AD and 44AE sections 44AD and 44AE
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Estimation-of-income schemes under 44AD/44AE exclude partner salary and interest deductions; no separate claim under section 40(b). The estimation provisions fix taxable income without regard to the usual deduction framework and therefore subsume expenses that would otherwise be claimed under partnership deduction rules; consequently no separate deduction for partner salary or interest is allowable where a firm elects the estimation scheme.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Estimation-of-income schemes under 44AD/44AE exclude partner salary and interest deductions; no separate claim under section 40(b).
The estimation provisions fix taxable income without regard to the usual deduction framework and therefore subsume expenses that would otherwise be claimed under partnership deduction rules; consequently no separate deduction for partner salary or interest is allowable where a firm elects the estimation scheme.
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