Taxation on transfer of LLP share by partner to third party

Summary: Transferring an LLP interest to a third party is treated as a transfer of a capital asset, triggering Capital Gains Tax for the partner. The valuation should be based on a professional report (e.g., NAV or DCF) to justify the price to tax authorities. You must also update your LLP agreement and file Form 3 and Form 4 with the MCA within 30 days.