Question ID : 29586

Book Profit Calculation for Professional Doctors

A LLP is formed for Hospital Services by the Doctors and their Wives. Some of the Doctors’ wives are not qualified as Doctors. The Doctors are receiving Professional Fee, from the LLP after deducting applicable TDS on the Professional Receipts, for the services rendered by them for the Patients admitted in the Hospital by them in Individual capacity. As per LLP Agreement the Partners are eligible to take Remuneration and Interest on Capital as per provisions of Sec. 40(b) of the act. As per Deed all the Partners are working Partners. Queries 1. Whether Professional Fees paid to the Doctors, from the LLP after deducting applicable TDS on the Professional Receipts, for the services rendered by them for the Patients admitted in the Hospital by them in Individual capacity, will be considered as Book Profit or not? I hope the same should be not treated as part of the Book Profit, since the same is earned due to their Professional Capacity. And the LLP’s Profit after deducting the same Professional Fees, Interest on Capital and remuneration is distributed among all eligible Working Partners as per provisions of the Agreement and the Act. 2. Similarly if any Fee Salary is paid for their services to the Hospital ,to non medico Wives of the Doctors who are Partners of the LLP also.

posted by AJAY JAIN on Apr 20 2018 12:00AM