Tax Implications on Retirement from Partnership
This query is : Resolved
11 October 2022
Respected Sir/ Madam
Please Guide
Partner of a firm having a Capital of Rs. 3,00,000 in the Firm resigns from the Firm. Full amount of his Capital in the Firm is paid to him vide cheque from the bank account of the Partnership Firm. The Partnership firm will be converted to a Proprietorship firm now onwards. What will be the tax implications. on the Retiring Partner pertaining to the transfer of Rs. 3,00,000.
Will It be Taxed
Under which head of Income will it be taxed
Also is the above arrangement for resignation from a partnership firm allowed.
Please guide
Thanks
Please Guide
Partner of a firm having a Capital of Rs. 3,00,000 in the Firm resigns from the Firm. Full amount of his Capital in the Firm is paid to him vide cheque from the bank account of the Partnership Firm. The Partnership firm will be converted to a Proprietorship firm now onwards. What will be the tax implications. on the Retiring Partner pertaining to the transfer of Rs. 3,00,000.
Will It be Taxed
Under which head of Income will it be taxed
Also is the above arrangement for resignation from a partnership firm allowed.
Please guide
Thanks
11 October 2022
It will not be taxed as no additional amount is paid over and above capital investments.
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