Can balance of current account can be withdrawn from the LLP

Can capital and current balance of LLP can be withdrawn by partners?

As found the income tax may prohibit the withdrawal.

If it is withdrawable at what rate it will be taxable?

 

Please help me with this 3 questions 

Replies (5)
Quick Summary
This discussion addresses whether partners can withdraw capital and current account balances from a Limited Liability Partnership (LLP). While LLP law itself doesn't prohibit withdrawals, the LLP agreement is key. The conversation also touches upon potential income tax implications and clarifies that capital receipts are generally not specifically taxed. A specific point of confusion regarding a 3-year waiting period after conversion from a private limited company to an LLP is also clarified, confirming that capital can typically be withdrawn sooner.

Can capital and current balance of LLP be withdrawn by partners?

There is no restriction in the law. The LLP agreement will decide this matter.

As found the income tax may prohibit the withdrawal. If it is withdrawable at what rate it will be taxable?

There is no prohibition. It is just a capital receipt. Not specifically taxed.

I have read somewhere that the current account balance of LLP can't be withdrawn till 3 years from the conversion. We have to wait for 3years for withdrawal of accumulated reserve. I am little bit confused in that. Can you please reconfirm that the 3years will not be an issue.

Yes, you are correct.

The original query didn't mention about conversion.

In the beginning i have private limited company which now got converted into LLP, so can i withdraw the current balance from the LLP.

Hii Manish 

Still not clear with answer, can i withdraw capital after conversion. 6month ago my company got converted into LLP. Can i withdraw capital, tomorrow.

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
ARTICLESHIP 28 September 2026
Junior Accountant

J S P M & Associates LLP

Pune

B.Com

View Details
Company
20 September 2026
Semi Qualified CA

Navin & Associates

Mumbai

CA Inter

View Details
Company
ARTICLESHIP 16 September 2026
Article Assistant

MANUJ SHARMA AND COMPANY

Noida

CA Inter

View Details
Company
19 September 2026
CA/Semi-CA/BCom

Pravin Sarvaiya

Mumbai

CA Inter

View Details
Company
08 September 2026
Semi-Qualified Assitant

Subrahmanyam & Sivudu CA Firm

Hyderabad

CA Inter

View Details
Company
30 September 2026
Senior Accounts Executive

Codeboard Technology

Chennai

MBA

View Details
Company
16 September 2026
Internal Audit - Team Lead

Consulting & Beyond

Chennai

CA

View Details
Company
15 September 2026
Client-site CA associate

Aditya Muley and Co

Mumbai

CA

View Details