Wealth tax for second flats

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

12 October 2012 i own a flat which has been rented .The interest on the home loan for 15 lacs comes to Rs 1.3 lacs for this house and rental value as per actual rent received is 85000/- .The property value was 20 lacs .

Now i have purchased a second flat for my own residential purpose in the different city . the property value is 20 lacs.The home loan taken is 15 lacs . Yearly interest is 1.47 lacs .

What could be wealth tax implications in this case . Will the first house property value be considered for wealth tax and if yes is it considered current value of property as per market rates or old purchased value .

As per my understanding there will be no tax implication as the home loan for 75% of property value has been taken for the second property and there will be no wealth exceeding 30 lacs if i consider the other wealth upto 5 lacs including gold and car . the first property value may not be considered for wealth assessment as only second property is considered for this .Please correct if i m wrong

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)

13 October 2012 1. One of the houses has been let out. If this house has been let out for a minimum period of 300 days, then it is NOT an asset. So wealth taz is NOT applicable on the let out residential property.

2. Ann individual assessee can claim exemption for one residential house.

You can avail this exemption for the second house.

Accordingly, NO wealth tax liability arises.

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