Income tax implication on sell of LLP

[Sanjay Lunia]

I am having LLP in which I have under construction property.

If I sell the LLP either to company or Individuals then who is liable to pay taxes?

As per my understanding it is partner who is liable to pay tax.

Tax would be capital gain either short term or long term depends on number of months of holding (if more than 24 months then long term else short term)

Rate of tax would be 12.5% in case of Long term and slab rate in case of short term.

I request the member, please either confirm or enlighten my understanding.

Thank you for your support and advice.

AI Summary

Partner selling LLP interest with under-construction property faces capital gains tax based on holding period A partner in an LLP inquired about tax implications when selling their LLP interest containing under-construction property. The partner believes they would be liable for capital gains tax rather than the LLP entity itself. They understand the tax treatment would depend on holding period: if held over 24 months, it qualifies as long-term capital gains taxed at 12.5%, while shorter periods result in short-term capital gains taxed at applicable slab rates. The partner sought confirmation of this understanding from forum members. The query involves determining the correct taxpayer entity and applicable capital gains tax rates for LLP interest transfers, particularly when the LLP holds real estate assets under development.