Assigning Property

This query is : Resolved

meenakshi somasundaram (Querist)
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16 February 2023 I am the managing Director of a Private limited company which is closely held. My husband, sons and I are the Directors.
Now I have got some 15 acres of landed property. I want to assign equal acreage of land to my sons who are the Directors enabling them to develop on their own by setting up business or manufacturing hubs.

Articles of association permits such transactions and if needed I can modify the clause.
Please advise as how I should carry out this as I want to settle the issue as early as possible, satisfying both parties, Tax and Children. I should not also be burdened.
Thanks.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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17 February 2023 If the land got in your name you can gift it to your sons no tax payable.

meenakshi somasundaram

meenakshi somasundaram (Querist)
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17 February 2023 The property is in the company's name, I have signed on behalf of the company as Managing Director. Is it possible to transfer without any sale consideration?

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CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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17 February 2023 Company can gift its property to director, provided Article of Association permits it.
Such gift will be taxable in the hands of your sons.

meenakshi somasundaram

meenakshi somasundaram (Querist)
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17 February 2023 What is the tax rate?

Gift tax is a must.

meenakshi somasundaram

meenakshi somasundaram (Querist)
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17 February 2023 The value crosses 1 crore

meenakshi somasundaram

meenakshi somasundaram (Querist)
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20 February 2023 I want to know how I should go about? My company Secretary says it is impossible. I am confused Please guide me,

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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20 February 2023 Individual slab rate applicable to the receiver of gift. No tax payable by the company.
Consult leading company secretary in practice.

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