TaxTMI 
TaxTMI 
what is the procedure of take over of registered proprietory business by registered privte limited company. what will be treatement of vat credit carry forward
take over of business
25 Mar 2011 
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Business transfer and tax registration: VAT credit treatment varies by state while capital transfer exemption may apply.
Transfer of a proprietorship to a private limited company can be tax neutral for income tax if statutory compliance secures a capital transfer exemption. VAT treatment is state dependent: generally the proprietorship's VAT registration must be cancelled and a new registration obtained for the company, while the treatment of carried forward VAT credit varies between refund claims and registration amendments as per State VAT law. (AI Summary)
Transfer of a proprietorship to a private limited company can be tax neutral for income tax if statutory compliance secures a capital transfer exemption. VAT treatment is state dependent: generally the proprietorship's VAT registration must be cancelled and a new registration obtained for the company, while the treatment of carried forward VAT credit varies between refund claims and registration amendments as per State VAT law. (AI Summary)