Interested to Buy Any Domain ? << Click Here >> for more details...
There are three partners in a partnership firm. The firm
has office premises in the name of firm. Depreciation on
this asset is charged every in the books of the firm. Now
after depreciation the book value of this assets has become
Rs. 1000. Whereas the market vakue of this premises id Rs.
10 crorer. To bring this property at MV the partners
revalued this premised at Rs. 8 crorers in the books of the
firm and accordingly credited partner's capital account in
their profit sharing ratio. My questions are as under.
What is the income tax liability of the firm on revaluation?
What is the income tax liability of partner of each partner
on revaluation and credit to his capital account.
In future whether depreciation to the firm is allowed on
revalued amount under the income tax act.
What happens to the tax liability if one partner withdraw
his entire capital from the firm which includes credit on
revaluation of office premises?
When partners can withdraw out of their credit balance in
their capital account without attracting any tax liability
either by the firm or by partner?
What happens if one partner retires and he gets amount
equal to his capital account which inclides credit on
account of revaluation? is there any tax liability to the
retiring partner?
- 1 Answers
- 7643 Views
- I also Faced
- E-Mail Answers
Answer Posted / engineer
No IT for firm. Only capital increased, not profits.
No depreciation is allowed as no purchase of asset has taken place.
Partner has to pay income tax on the withdrawn capital depending on type of asset. If it is building etc there are indexation and long term capital gain exemption. But otherwise, by withdrawing the capital the asset has been sold to other 2 partners and a profit has been made and therefore liable to IT as rules of IT.
When the firm is dissolved and capital is taken back by the partners, there will be no IT.
Retirement causes payment of income tax.
these are my understanding. CA will answer this better
| Is This Answer Correct ? | 1 Yes | 5 No |
Post New Answer View All Answers
Should airlines be allowed to charge people for using the toilet on a plane?
IF A COMPANY ENTER INTO A LEASE AGREEMENT WITH ANOTHER COMPANY OUTSIDE THE STATE, CAN A LASEE ISSUE "C FORM" AGAINST SUCH LEASE PURCHASE.
Sir, I have applied for the post of Cashier/ Inter-preter/ Inspector in Charity commissioner, Mumbai. I have required the previous year exam question papers or which question are likely to be asked for the such exam.
which act have to follow for court marriage
when was started salt stahagragam
How many pending cases are there in INDIA?
where can i find indian patnership act on the net?
We will be receive Form-F from Our Delhi Unit but he tell us that FORM -F issue quarterly . But our Noida Sales Tax Deptt. required Monthly For the F.Y.2006-07 & 2007-08
If a wife had expressed distaste for it previously, would her husband's habit of putting marmalade in his egg at breakfast be grounds for divorce?
Have you any questions about law?
what is the procedure of registering a company?
I am a merchant exporter,I want purchase products of steel items from the registered dealer. what is the procedure for it ? and what procedure for the Excise rebate claims?
My father Mr. Prakash was working with SBM, Bangalore and had taken 2 Insurance policies on LIC- Under Salary Savings Scheme, 2 Insurance Policies on LIC under Accident Benefit Policy, 1 Insurance Policy on Bajaj Allianz under Accident Benefit and scheme and has received benefit of about 6 lakhs from Bank as Insurance amount on his death. He had nominated my step mother (second wife of my father) as nominee for all the above mentioned, and now she is refusing to share the benefit among us (my father had married her after my mother deceased , we are 3 children). Please suggest whether we get our share… do we have any rights on Insurance benefits??
How you cope without motivation?
MY wife & me both rworking in same organisation.i purchased a flat in my name recently.As per income tax act u can choose one house in ur choice for self ccupied purpose & all other house is assumed to be let-out.so my question is that,shall i purchase another new house in my wife name and that house can i take as self occupied of my wife ?Plz suggest me in this regards in briefly.
