Remuneration from Partnership Firm - 44AD

[NIKITA JAIN]

Remuneration from Partnership Firm is taxed under the Head Income From Business or Profession by virtue of Section 28 & Section 44AD allows to show Income under the Head Income from Business or Profession @ 8% of Gross Receipts/Turnover. So can I apply the same 8%, on Remuneration or Interest from Partnership Firm and file my returns?

For Eg: If my Remuneration from Partnership Firm is Rs,12,00,000 and Interst on Capital received is Rs,10,00,000 can I compute 8% on 22,00,000 (Interest & Remuneration) and show my Income as Rs,1,76,000.

If Not, then which Section or Rule stops me from doing the same?

[CASusheel Gupta]

Refer to decision in MR. A. ANANDKUMAR VERSUS ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-2, SALEM =  2019 (2) TMI 165 - ITAT CHENNAI which denies such treatment.

CA Susheel Gupta

9811004443

AI Summary

Presumptive taxation treatment cannot be used to cover partnership remuneration and interest according to cited authority. The document addresses whether partner remuneration and interest on capital from a partnership firm can be included in gross receipts and taxed under the presumptive taxation regime at a fixed percentage; the response states that a tribunal decision denies that such remuneration and interest qualify for presumptive computation and therefore the claimed aggregation is not permissible for presumptive return filing.