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Document Type: Tax Law Article
Law: Income Tax Law (Royal Decree No M/1 - 21 Feb 2004)
Article Number: 42
Country: 🇸đŸ‡Ļ KSA
Location: Chapter 8 - Taxation Rules of Partnerships
Order: 42

Article 42 - Change of Partners in a Partnership

Article 42 - Change of Partners in a Partnership

Chapter 8 - Taxation Rules of Partnerships

Article 42 - Change of Partners in a Partnership

  1. If a partner or partners enter into or retire from a partnership which results in its reconstitution, all its assets shall be considered transferred to the new partnership against shares in this partnership.

  2. Reconstitution of a partnership occurs when the entry or retirement of a partner or partners results in a change in the partnership's membership exceeding 50% of its formation in the year preceding the change.