Register LLP or company.
Investing in startup for ownership of income earning e bikes - start co. to save income tax
Sir/Ma'm, I am.plannong to invest about 31 lacs in an ebike startup for ownership of 30 e bikes which the company will put on rent for b2c and Bob with assures returns for a period of 4 years.At end of 4 years the company will buy back the ebikes.I am a regular salaried employee with a annual income of about 12 lakh pa(gross).Please advise best way to save tax on my e bike income for next 4 years (Projected income 1.45 lacs pm for 4 years).Should I start own llp and register these ebikes on the company or buy on my own personal name.I have personal loan of 68 lacs.Please suggest different options for best tax saving .Thanks in advance .
Asked 3 years ago in Income Tax
Dear Sir,
Hope you are doing well !!
It is advisable to take a phone consultation for detailed discussion.
We may assist you for the same.
Hi
Since the issue involves many factors to be considered, we may discuss the issues over a phone consultation in detail and plan taxes accordingly.
Form a company and appoint two directors in it. Put share capital in company.Buy all the bikes in name of company & do the business. You can Pay two directors salary & withdraw money in that way. IN such way you can avoid taxes in your hand & further unlike other structures of business Profit in companies at max are taxed @25% against your slab rate of 33%.
If I make LLP with me & wife as directors ( pm gross income 1 lac self ,70 k wife)& llp ebikrle income 83k pm A) how much approx will be net income after tax on llp income of 83k B) best tax saving ideas as an llp to maximise net income. C)I presetly have invested 21 lacs on my name & agreement on my name .LLP not yet formed.IfI I change agreement in name of LLP later is it acceptable as per IT rules. Thanks. Vijay
Asked 3 years ago
How will the agreement be made.
We need to check the terms of agreement since there are buy back and other things included. Also how will the company show such agreement.
What other expenses would be there etc.
Further the choice to register it in your own name is not advisable at all since you are already earning a regular salary.
We can discuss more over phone call.
Hope you find the above information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.
Thank you
- It is better to form a Private Limited company as income tax rate is lower than LLP.
- Due to the complexity involved in the matter, it is advisable to take phone consultation.
Ask a Chartered Accountant
Get tax answers from top-rated CAs in 1 hour. It's quick, easy, and anonymous!
Ask a CA