Wealth Tax on cars used not for hiring or as stock in trade

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Querist : Anonymous

Querist : Anonymous (Querist)

17 February 2011 In case of cars, wealth tax is payable on which value of the cars? Whether it is WDV or value considered for insurance purposes? The law specifies that in case of depreciable assets, WDV has to be considered but it seems the tax authorities consider value considered for insurance.Is there any case law for considering insurance value?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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17 February 2011 The valuation of Asset as per Schedule III
has to be considered in this case.
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Schedule III prescribes that in case of Motor Car its price for which it can be sold in open market on the valuation date has to be considered.
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In case WDV+20% WDV is not greater than the "Market Value" on Valuation date then WDV will be taken as the value of such motor car.
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In another Case when WDV+20% WDV is greater than the Market Value, in such case only Market value will be considered for wealth tax purpose.

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