Can a music director create LLP?
This query is : Resolved
06 August 2021
A celebrated movie director (assessee) is likely to get a substantial amount as revenue in the current financial year. As a part of tax planning, he wants to create to an LLP. So long his income was taxed and filed as an individual. Can he create an LLP and transfer his income so that he can avoid high surcharge rates? Since his individual creative talent is being used, will forming an LLP be tenable?
Also, he wants to transfer this amount, (after paying relevant tax on this) to his wife, who will later invest this in her business (sole proprietary). Will section 64 get attracted in this case regarding clubbing of income?
Also, he wants to transfer this amount, (after paying relevant tax on this) to his wife, who will later invest this in her business (sole proprietary). Will section 64 get attracted in this case regarding clubbing of income?
06 August 2021
Yes, music director can create LLP.
Section 64 not applicable on business income earned.
Section 64 not applicable on business income earned.
07 August 2021
For a music director, the professional income arises out of his creativity. Will it be tenable to create an LLP, where there is no contribution from the other partner?
Regarding section 64, if a substantial part of Assessee's professional income (on which tax is paid) is gifted to his wife who has her own business, will income from such transfer (assuming not invested in her business) clubbed with the assessee instead of her?
Regarding section 64, if a substantial part of Assessee's professional income (on which tax is paid) is gifted to his wife who has her own business, will income from such transfer (assuming not invested in her business) clubbed with the assessee instead of her?
07 August 2021
No body/ no law will question such LLP creation.
Yes, it will be clubbed.
Yes, it will be clubbed.
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