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TOPIC: Partnership Company (one partner leaving)

Partnership Company (one partner leaving) 6 years 10 months ago #258

  • Kevin
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Good day!

We are a partnership company composed of only two individuals registered in the City of Mandaluyong.

We would like to seek your professional advice on how to go about the following scenario:

- One partner is leaving the Philippines and wants to transfer all his shares to the other partner or to a third party individual without any monetary exchange.

1. If the share is transferred to the partner, is it correct to assume that the company will then just turn into a single proprietorship without losing the identity of the company?
2. If the share is transferred to a third party individual so the partnership can continue, is it possible?
3. In any case, since the share will be transferred, will there be any tax payments required even if the share is donated?

We hope to hear from you soon.

Thank you.

Regards
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Partnership Company (one partner leaving) 6 years 10 months ago #282

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1. Yes, you can have it modified and registered as a single proprietorship or if you want to continue it as a partnership, then recruit partners,

2. The partnership can still continue as long as the consent in the transfer is authorized by the other partner. A partner cannot be compelled to stay as a partner if he refuses to.

3. Yes, donor's tax.
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Partnership Company (one partner leaving) 6 years 10 months ago #330

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Thanks for the reply Atty. If I may stretch a bit the discussion of point #1, does it mean that if the remaining partner chooses to register the business as a single proprietorship, it can retain the identity of the company (Name and Business Track Records) except that it will then be classified as a single proprietorship? How about the implications to the BIR Registration? I believe if it is a single proprietorship, then the registered owner will have to use its TIN and not the TIN of the company when it was still a partnership. Is it correct sir? Thanks.
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Partnership Company (one partner leaving) 6 years 10 months ago #336

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If you will be permitted to register the same name then there will be no problems, better ask SEC or DTI. Of course you can keep the identity.

You are correct with the TIN. A single propiertorship has the same identity as the proprietor. Since the partnership was dissolved, then there is no use for its TIN.
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