Presumptive taxation: partner remuneration and interest cannot be treated as individual business turnover for presumptive tax purposes. Section 44AD applies only where the assessee carries on an eligible business and has actual turnover or gross receipts attributable to that assessee. ... Summary
Presumptive taxation: partner remuneration and interest cannot be treated as individual business turnover for presumptive tax purposes.
Section 44AD applies only where the assessee carries on an eligible business and has actual turnover or gross receipts attributable to that assessee. Remuneration and interest paid by a partnership firm to a partner arise from the firm's accounts and partnership agreement; although Section 28(v) taxes such receipts in the hands of the partner, that deeming does not convert them into the partner's turnover or gross receipts for Section 44AD. Section 40(b) governs firm deductibility but does not create an independent business activity in the partner; hence such receipts cannot be subjected to Section 44AD presumptive taxation.
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