05 May 2015
Hi, I would seek an opinion on transfer from Pvt. ltd. company to LLP. where it is a matter of procedure to do the same, I have a question on the implication on profits lying in reserves in pvt. ltd. company before conversion?
for e.g. if there are profits to the tune of say 10 lac lying in reserves of company, if it is distributed as dividend it will attract DDT. after conversion to LLP whether LLP can distribute that 10 lac to partners and if yes what would be the tax implication?
Thanks in advance for your valuable time and advice.
05 May 2015
Thanks Miteshbhai, but my question is how to utilise that money lying in reserves as accumulated profits? As i know as per 47(xiiib) of income tax, partners cannot utilise the reserves for a period of 3 years after conversion, in a way it benefits partners directly or indirectly. if so what after 3 years, can they distribute the reserves among partners with not tax liability??
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