A father wants to transfer his business (trading of electronic goods) to his son, from 1st April 2017. What legal requirements are required in this process? Will it be advisable to treat it as gift?
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(173281 Points)
Replied 23 March 2017
Constitution of business?
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(173281 Points)
Replied 23 March 2017
Simple way is to close the business and re-establish in the name of SON.
But sometimes, because of some contractual terms and or goodwill of the business etc., which may be required to transfer to son ( as per your wish to gift business), better idea would be to introduce son as partner. Father may continue till his wish/need as sleeping partner, or may retire at some suitable occasion.
SSG
(1936 Points)
Replied 23 March 2017
Sir, partnership won't be suitable from income tax point. Actually father is old age and the son is running the business in father's name. Now they want to change the prop. - from father to son. Should gift deed be prepared and how to treat the capital of father?
Sir, please advise?
Studentsca
(CA Practice )
(3577 Points)
Replied 24 March 2017
SSG
(1936 Points)
Replied 24 March 2017
Whether all these requirements be required if father gifts his business to the son? Can a gift deed alone be sufficient, for changes to be submitted in the bank, income tax and sale tax departments?
SSG
(1936 Points)
Replied 24 March 2017
Is it compulsory to change the name of the business, when proprietor is being changed?
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