Go AD-Free with CAclubindia Pro and Daily WhatsApp Updates. Subscribe Now!

Wealth tax

Mokshak Mehta (Student) (53 Points)

03 September 2013

I would like to Know whether is there any wealth tax applicable in this situation

There is a land which has just came into the city limit in AY13-14 We are getting a rent from the land and its a residential land. Will be any wealth tax payable if we are getting a rental income?

Reply
Follow
Share

2 Replies

JAINENDRA JAIN (ACS/CA) (1668 Points)
Replied 03 September 2013

residential property let out for more than 300 days in a year is exempted for wealth tax.

1 Like

Upgrade to CAclubindia Pro. Subscribe Now!

CA Pallav Singhania (IT System Auditor) (33678 Points)
Replied 03 September 2013

Financial assets, one residential property, as well as cars,

property and other assets used for commercial or business purposes are exempt from wealth tax.

Any property rented for at least 300 days in a year also doesn't attract wealth tax..

1) Wealth tax is an annual direct tax imposed on the net wealth of individuals and HUFs with reference to the preceding financial year or the current assessment year. 2) Net wealth is calculated as the aggregate value of all chargeable assets on the valuation date, minus the outstanding debt on these assets. 3) Financial assets, one residential property, as well as cars, property and other assets used for commercial or business purposes are exempt from wealth tax. Any property rented for at least 300 days in a year also doesn't attract wealth tax. 4) The taxable assets for wealth tax include real estate and land other than a house, precious metals, including jewellery and bullion, motor cars, urban land and cash more than Rs 50,000. 5) Wealth tax is charged at 1% on the amount that exceeds Rs 30 lakh of the net wealth of the assessee on valuation date, which is 31 March of a financial year. 6) For resident Indians, wealth tax is payable on all taxable assets in India or abroad. For NRIs, wealth tax is applicable only on the assets that are in India. Courtesy: Economic Times of India

Read more at: /forum/six-smart-things-to-know-about-wealth-tax-263822.asp

If no construction has been started, it will be taxable under Section 2(ea) as Urban Land... However, if a construction is under process it will not be treated as land as it ceased to remain as unused land and being occupied any building constructed with the approval of the approved authority.

Read more at: /forum/wealth-tax-on-land-27391.asp#.UiXdP1NCmho

1 Like