Taxability of Bad debts recovered from discontinued business
M/s X firm discontinued its business during the FY 2017-18. However, the bank account of the said firm was not closed. During the FY 2018-19, bad debts recovered of the firm received Rs.1,00,000/-. Clarify on the tax treatment on this regard.
If the firm's PAN is not surrendered, and the bad debts which we have recovered now should have been claimed as expense in any of the previous years, then it should be chargeable to tax in the year of receipt..
What if the bank account of the firm is still open with zero balance and the recovered amount is credited in the firm's bank account? Under which head of income the same will be taxable? The PAN is surrendered by the firm.
Tax is compulsory if the business is small and large we have to pay it at any cost with the help of debt service. After joining this service bestessays uk we can check its accuracy and reliability.
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If the firm's PAN is not surrendered, and the bad debts which we have recovered now should have been claimed as expense in any of the previous years, then it should be chargeable to tax in the year of receipt..
What if the bank account of the firm is still open with zero balance and the recovered amount is credited in the firm's bank account? Under which head of income the same will be taxable? The PAN is surrendered by the firm.
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It shall be taxable under PGBP head in the hands of partners in their profit sharing ratio...
What will be the rate at which it should be taxed, and what if the partners taxable income does not exceed the basic exemption limit...??
It shall be taxed at normal slab rates, no special rate is applicable....
If the partners taxable income does not exceed basic exemption limit, then there is no impact of tax on account of bad debts recovered...
Tax is compulsory if the business is small and large we have to pay it at any cost with the help of debt service. After joining this service bestessays uk we can check its accuracy and reliability.
Thank you for sharing this information. Your blog is really I like the quality of content written by your writers. Do share on social media. Sharing valuable content is always a good way to enhance knowledge. 333 meaning