COMPANIES ACT - 1963 (ACT 179)

    Section - 195 - Prohibition of Tax-free Payments

    (1) It shall not be lawful for a company to pay a director or secretary of the company remuneration free of income tax or otherwise calculated by reference to or varying with the amount of his income tax except under a contract which was in force prior to the sixth day of April, 1961 and provides expressly, and not by reference to the company's Regulations, for payment of remuneration as aforesaid.

    (2) Any provision contained in a company's Regulations, or in any resolution of a company or of a company's directors, or in any contract, other than such a contract as is excepted from the provisions of subsection (1) of this section, for payment of remuneration as aforesaid shall have effect as if it provided for payment, as a gross sum, subject to income tax, of the net sum for which it actually provides.

    (3) This section shall not apply to remuneration due before the commencement of this Code or in respect of a period before the commencement of this Code.