“See the latest income Tax rates or income tax slab for partnership firms for A.Y. 2015-16 & A.Y. 2014-15″

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Income Tax Rates on Partnership Firm for A.Y. 2015-16

Income Tax Rate
Surcharge
Education Cess
30% on whole of the income10% surcharge will be applicable where total taxalbe income is over Rs.1 Crore. 3% (2% of income tax and Additional Secondary & Higher Education Cess @ 1% is also levied on all assessees.

Income Tax Rates on Partnership Firm for A.Y. 2014-15

Income Tax Rate
Surcharge
Education Cess
30%10% surcharge will be applicable where total taxalbe income is over Rs.1 Crore. 3%

A partnership firm for the purpose of income tax means a partnership firm includes a limited liability partnership firm.

Partnership Taxation

Partnership firm is treated as a separate entity. It is immaterial that partnership is registered or not registered. So partnership firm is taxes under the income tax slab for partnership firm and partners are taxes under the income tax slab for individuals.

Partnership Income Tax Slab/ Income Tax Rates on Partnership Firm for A.Y. 2013-14 

Partnership Firm are taxed at a flat rate irrespective of income for the A.Y.2013-14 or F.Y.2012-13 as follows

  • Tax rates on partnership firm is 30%
  • Any long term capital gains¬† shall be taxable @ 20%
  • Short term capital gains shall be taxable @ 15%
  • Education cess @2% and secondary & higher education cess @1% will be applicable. However surcharges has eliminated from A.Y.2012-11.

FAQ Related to Partnership Income Tax Rates/Slab

Q.#1: Is partnership firm liable to deduct tax at source on partner salary and interest?

As the partner are individually taxed by the income tax slab on individuals. But the firm is not required to deducted TDS on the partner’s salary and interest paid to the partners.

Q.#2: Is partner’s share profit exempt from income tax while calculating partner’s income tax?

Yes the share of profit is exempt from income tax as it is already taxed according to the income tax slab for partnership firms.

Q.#3 How to calculate income tax of partnership firms according to income tax slab on partnership firms?

Ans. In computing the total income of the firm, any salary, commission, remuneration and bonus to a partner shall be deductible subject to certain restriction.

Q.#4 What is Alternate Minimum Tax (AMT)?

Ans. The provision relating to Alternate Minimum Tax introduced in A.Y. 2013-13 for Limited Liability Partnership (LLPS). Now, it has extended to all partnership firms w.e.f. A.Y.2013-14. The deduction under section 80HH to 80RRB is claimed only by paying minimum tax @ 18.5% on adjusted total income of partnership firms or LLPs.

Hope, now you all know the income tax rates on partnership firm. We will cover other aspects like filing of income tax return of partnership firm, assessment of partnership firms and book profit.

One Response to Income Tax Rates on Partnership Firms [A.Y. 2015-16] & [A.Y. 2014-15]

  1. krishan lal says:

    status of partner tax in partnership firm

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