Balance Sheet for two GST numbers

A/c entries 408 views 2 replies

Harwinder Singh

Partner

21 Points Joined June 2021

Dear Members,

Stuck in a dilemma. We have a manufacturing business. A proprietorship was registered in the name of my father who expired in December last year. To keep the operations running we registered a new proprietorship in the name of my mother. Due to her old age, we decided to float a new partnership on 1st of April of next financial year, due to some delays in the registration of GST, my legal consultant suggested to keep the proprietorship running and once the new GST number is issued by the department we can shift the operations to partnership. He also suggested before closing the operations of proprietorship to bring the GST balance to minimum and stop all the purchase in proprietorship, while continuing the sales. Meantime we also started purchasing in the New Partnership.

I am confused about how the balance sheet of the current financial year will be filed, since an Old Proprietorship and a New Partnership are in functioning in the same period for a month.

Any help will be appreciated. Thanks in advance

Replies (2)

CMA Poornima Madhava

CMA

13117 Points Joined May 2009

Partnership firm is an independent entity having separate identity and all transactions related to the same would be recorded as part of the firm.

Proprietorship concerns are PAN based and all the transactions of the proprietor under his/her PAN would form part of financial statement of the proprietorship concern.

Further, share of profit of the partner of the firm (who is also a proprietor of another concern) would be included in the income of the partner/proprietor and the same is not taxable in the hands of the proprietor/partner.