Business conversion
prachi jain (105 Points)
27 December 2017
What are the tax implications for conversion of proprietorship to partnership?
prachi jain (105 Points)
27 December 2017
prachi jain
(105 Points)
Replied 28 December 2017
Rishi Mehta
(Ur friend )
(1533 Points)
Replied 28 December 2017
Situation as given by you amount to “transfer” of capital Asset in accordance with provisions of section 2(47).
Section 47 specifies certain transactions of transfer not to be treated as “transfer” for the purpose of charging of capital gain tax.
Conversion of proprietorship into partnership is not covered under section 47. Therefore, conversion in your case liable to tax.
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