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Number of partners 3 4 8
Profit-sharing ratio Equal Equal Equal
Total capital contribution of partners (each contrib 1,500,000 3,000,000 8,500,000
700,000 1,500,000 4,000,000 100%
Tax on firm
Income 700,000 1,500,000 4,000,000 90%
Less: salary 402,000 774,000 1,878,000
LESS: INTEREST @12% 180,000 360,000 1,020,000 80%
NET INCOME 118,000 366,000 1,102,000
TAX @ 30.9% 36,462 113,094 340,518 70%
Tax liability of each partner 12,154 28,274 42,565
Tax on partner Case 1
60%
Particular Case 1 Case 2 Case 3 No of Part 3
Number of partners 3 4 8 Profit of t 700,000
50%
Salary 134,000 193,500 234,750 Income by 233,333
Interest 60,000 120,000 340,000
40%
Income 194,000 313,500 574,750 233,333
Income after 80C DEDUCTIONS 44,000 163,500 424,750 Net 50,000
Tax on net income 0 0 10250 30% 0
10%
0%
3
90% 40,000
80%
35,000
70%
30,000
Case 2 Case 3
60%
4 8
25,000
1,500,000 4,000,000
50%
375,000 500,000
20,000
40%
375,000 500,000
225,000 350,000 15,000
30% 0 -5150
10,000
20% 0 -5,150
10% 5,000
0% 0
3 4 8
50,000
40,000
TAX LIABILITY
30,000
20,000
10,000
0
3 4 8
-10,000
10,000
0
3 4 8
-10,000
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
8
RSHIP FIRM
8
8
Taxable in Interest onSalary payaTaxable income ofTax liability of the fi Tax liabilit Total tax as percentage of income (5+6) as
1 2 3 4 5 6 7
Rs. Rs. Rs. Rs. Rs. Rs.
500,000 120,000 318,000 62,000 19,160 0 3.83%
1,000,000 120,000 618,000 262,000 80,960 14,210 9.52%
1,500,000 120,000 918,000 462,000 142,760 59,320 13.47%
2,000,000 120,000 1,218,000 662,000 204,560 121,120 16.28%
2,500,000 120,000 1,518,000 862,000 266,360 182,920 17.97%
3,000,000 120,000 1,818,000 1,062,000 328,160 244,720 19.10%
Taxable incSalary to dTaxable in Tax liability of t Taxable income of X Tax liabilit Total tax (7) as% of (1)
1 2 3 4 5 6 7 8
Rs. Rs. Rs. Rs. Rs. Rs. Rs.
500,000 390,000 110,000 33,990 195,000 0 33,990 6.80%
1,000,000 690,000 310,000 95,790 345,000 4,640 105,070 10.51%
1,500,000 990,000 510,000 157,590 495,000 20,090 197,790 13.19%
2,000,000 1,290,000 710,000 219,390 645,000 55,620 330,630 16.53%
2,500,000 1,590,000 910,000 281,190 795,000 86,520 454,230 18.17%
Firm company
(7) as% of (1) TAX INCIDENCE ON PRIVATE LIMITED COMPANY AND DIRECTORS
100% 400,000
60000
90% 0 -250000 0 350,000
345000
80% 0 345,000 95,000 4640
300,000
495000
70% 0 495000 245,000 20090
645000
60% 0 645000 250000 25750 145000 55620 250,000
795000 0 795000 250001 25750.1 295000 86520
50% 200,000
945000
40% 0 945000 250002 25750.21 445000 117420 150,000
30%
100,000
20%
10% 50,000
0% 0
500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000
SALARY COMPANY TAXABLE INCOME
TAX BY COMPANY TAX BY DIRECTOR
20.00%
Total Tax as % of income
15.00%
10.00%
5.00%
0.00%
500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000
Total
5.00%
0.00%
500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000
proprietorship
Taxable in Interest onSalary payaTaxable income ofTax liability of the fi Tax liabilit Total tax as percentage of income (5+6) as % o
1 2 3 4 5 6 7
Rs. Rs. Rs. Rs. Rs. Rs.
600,000 120,000 378,000 62,000 31,520 0 5.25%
1,200,000 120,000 738,000 262,000 105,680 0 8.81%
1,800,000 120,000 1,098,000 462,000 179,840 0 9.99%
2,400,000 120,000 1,458,000 662,000 254,000 0 10.58%
3,000,000 120,000 1,818,000 862,000 328,160 14,200 11.41%
3,600,000 120,000 2,178,000 1,062,000 402,320 45,100 12.43%
Taxable incSalary to dTaxable in Tax liability of t Taxable income of X Tax liabilit Total tax (7) as% of (1)
1 2 3 4 5 6 7 8
Rs. Rs. Rs. Rs. Rs. Rs. Rs.
500,000 450,000 50,000 15,450 90,000 0 15,450 3.09%
1,000,000 900,000 100,000 30,900 180,000 0 30,900 3.09%
1,500,000 1,350,000 150,000 46,350 270,000 0 46,350 3.09%
2,000,000 1,800,000 200,000 61,800 360,000 6,180 92,700 4.64%
2,500,000 2,250,000 250,000 77,250 450,000 15,450 154,500 6.18%
3,000,000 2,700,000 300,000 92,700 540,000 33,990 262,650 8.76%
Firm company
12.00%
Total Tax as % of income
10.00%
8.00%
6.00%
4.00%
2.00%
0.00%
500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000
8.00%
Total Tax as % of i
6.00%
4.00%
2.00%
0.00%
500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000