When Royalties Are Less Than the Minimum Rent?

Shortworkings. Difference of minimum rent and actual royalty is known as shortworkings where payment of Royalty is payable on the basis of minimum rent due to shortage in the production or sale. For example, if calculated royalty is Rs.

When royalty is less than the minimum rent?

Difference of minimum rent and actual royalty is known as shortworkings where payment of Royalty is payable on the basis of minimum rent due to shortage in the production or sale. For example, if calculated royalty is Rs. 900,000/- as per sale of books based on the above example, but royalty payable is Rs.

When the royalty payable works out to be less than the minimum rent the difference is called?

Short Workings or Redeemable Dead Rent

Short Workings is nothing but the amount by which the minimum rent is more than the actual royalty. In other words, short workings is the difference between minimum rent and actual royalty. In the example above, the Short Workings amount to Rs 1 Lakh (5 Lakh – 4 Lakh).