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Withdrawal from partnership 043-03130120

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This page has an example of a customer who does not receive adequate consideration on withdrawal from a partnership that results in deprivation.

Example

Adequate consideration not received

Item

Description

1

Adequate consideration not received

Richard, Amanda and Salvatore have a business partnership. The net partnership assets as at the end of the last financial year were $60,000.

  • Salvatore's share of the capital account balance is $40,000
  • Amanda's share of the capital account balance is $30,000
  • Richard's share of the capital account balance is negative $10,000

Salvatore withdraws from the partnership receiving $20,000 as consideration and is deprived of $20,000. The excess over the allowable disposal limit would be assessed as deprivation.