Need Tally
for Clients?

Contact Us! Here

  Tally Auditor

License (Renewal)
  Tally Gold

License Renewal

  Tally Silver

License Renewal
  Tally Silver

New Licence
  Tally Gold

New Licence
 
Open DEMAT Account with in 24 Hrs and start investing now!
« Professional Updates »
Open DEMAT Account in 24 hrs
 Board of Internal Audit and Management Accounting of ICAI is organizing Webinar on "Identifying Red Flags and Report Writing by Internal Auditors" - March 27,
 Revised Applicability of Peer Review Mandate (Phase II & III)
 Important Announcement - Reschedulement of Chartered Accountant Examinations, May 2024
  IMPORTANT ANNOUNCEMENT
 Extension of Last Date for Online Empanelment of Members to act as Observers for May/June 2024 Examinations up to 15th March 2024
 Empanelment of Members to act as Observers at the Examination Centres for the Chartered Accountants Examinations May/June 2024
 Guidance Note on Audit of Banks (2024 Edition)
 Issuance of SA 800 (Revised), SA 805 (Revised), SA 810 (Revised)
 Implementation Guide on Reporting on Audit Trail under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 (Revised 2024 Edition) - (12-02-2024)
 Important Announcement for May-June 2024 CA Examinations
 Draft Bank Branch Auditors' Panel (MEF) for the year 2023-24

ICAIs suggestion on LLP considered while passing Finance Bill, 2010
May, 17th 2010

The ICAI is pleased to note that its suggestion relating to exemption of capital gains in the hands of shareholders consequent to conversion of a company into a LLP, has found favour with the Government. It is also heartening to note that one out of the three amendments made while passing the Finance Bill, 2010 was in accordance with the suggestion given in the Post-Budget Memorandum, 2010 submitted by the Direct Taxes Committee of ICAI. One of the other two proposals is an extension of relief granted unilaterally by the Honourable Finance Minister.

 
In point no.2(a) of the Post-Budget Memorandum 2010 submitted on 31st March, 2010, the ICAI had observed that though as per section 47(xiiib), conversion of a company into an LLP is exempt from tax subject to fulfilment of certain conditions specified therein, tax liability would be attracted in the hands of shareholders since the provisions of section 46(2) and 2(22)(c) would become applicable consequent to the deemed liquidation of the company on its conversion into a LLP.

Therefore, it was suggested that when the account of the shareholder is credited in the books of the LLP on such conversion, the provisions of section 46(2) and section 2(22)(c) levying tax on the shareholder on distribution of assets on liquidation of a company should not apply.

 
This suggestion of ICAI has been considered while passing the Finance Bill, 2010 and has been effected by amending section 47(xiiib) to provide that any transfer of a share or shares held in a company by a shareholder as a result of conversion of the company into a LLP would also not be considered as a transfer for levy of capital gains tax.
 
Please click below to download the Amendments to the Finance Bill, 2010.

http://www.icai.org/resource_file/19175announ10401.pdf

Home | About Us | Terms and Conditions | Contact Us
Copyright 2024 CAinINDIA All Right Reserved.
Designed and Developed by Ritz Consulting