Save Rs 588 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

Conversion of proprietary into partnership

Save Share

This query is : Resolved

MOHIT KUMAR TOMAR (Querist)
Follow

14 September 2018 What are the Tax implications on Conversion of Proprietary Business into Partnership of the same Proprietor?

Facts:- Mr.Mohit Kumar is the Proprietor of Mohit Construction Co. and now he is converting his Proprietor business into Mohit Construction Co., as a partner along with his Son Rahul with a capital Introduction of Rs 75000 and RS25000 Respectively.

PSR is 50:50.

Mahesh Paryani

Mahesh Paryani (Expert)
Follow

14 September 2018 As per income tax the asset transferred would be chargeable to tax, section 45 read with section 48. As per GST Act you can refer to schedule 2 clause 4a and 4c if the proprietor still continues to do business under proprietorship then it would be chargeable to tax if he ceases to be taxable then It is not liable.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now