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    Resignation of a partner from LLP

    Posted By : Ekta / Published on : 27-Jul-2019 05:36 AM / View : 783 / Comment : 1

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    Will resignation of a partner from the LLP within one year of conversion from company to LLP will attract capital gain tax although the profit sharing of the remaining partner will be more than 50per cent??
    Read more on : partner resignation

    • The resignation of a partner from an LLP within one year of conversion from a company to LLP may not attract capital gain tax if the following conditions are satisfied:

      1. The partner transferring his/her share is an individual and not a company.
      2. The partner transferring his/her share is not receiving any consideration or benefit in return for the transfer.
      3. The transfer of share takes place within 12 months from the date of conversion of the company into an LLP.
      4. The profit sharing ratio of the remaining partners in the LLP is not less than 50% of the total profits of the LLP.

      However, it is advisable to consult a professional to get a clear understanding of the tax implications of such a transaction.

      31-03-2023 / 10:56:43 AM
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