Firm taxation framework: prescribed firm tax rates, capital gains treatment, partner exemption, deductions and loss carryforward rules. Partnership firms and LLPs are taxed at firm level with specific rates for ordinary income and capital gains, surcharge and health and education cess; partners' shares in firm income are exempt in their hands. Remuneration and interest to partners are deductible to the firm within statutory limits and taxable to partners, while disallowed payments are excluded from partners' business income additions. Losses and unabsorbed depreciation remain with the firm for carryforward, subject to limits on loss carryforward where constitution changes on retirement or death. Firm and partner return filing dates vary by audit requirement.
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.
Firm taxation framework: prescribed firm tax rates, capital gains treatment, partner exemption, deductions and loss carryforward rules.
Partnership firms and LLPs are taxed at firm level with specific rates for ordinary income and capital gains, surcharge and health and education cess; partners' shares in firm income are exempt in their hands. Remuneration and interest to partners are deductible to the firm within statutory limits and taxable to partners, while disallowed payments are excluded from partners' business income additions. Losses and unabsorbed depreciation remain with the firm for carryforward, subject to limits on loss carryforward where constitution changes on retirement or death. Firm and partner return filing dates vary by audit requirement.
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