Wealth tax

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JOHN

OWNER

31 Points Joined May 2014

I have inherited a small plot of land from my father. Unfortunately the fair value for the land is more than 3cr. If I sold the land I would not get that much because of its shape and surrondings. The land does not contain a house, The land is classed as urban land.

What can I do to avoild wealth tax, as my income is only 2.5 lakh per year, wealth tax alone would come to more than 3lakh ( @ 1% of fair value).

If I build a small house on the land would that be enough to remove the wealth tax liability.

Can I try and arrange a pay & park on the land (this is difficult as no one would really want to park there.

Please help .

can anybody suggest what else I can do.

Thankyou.

Replies (2)

caaspirant

349 Points Joined February 2014

Start using it for agricultural purposes. Though it is not specified as exempt or non taxable but several courts in several such cases have allowed exemption from wealth tax, they have done so keeping in mind the main intent of wealth tax that wealth should not remain idle in few hands and should be used in such a way that income can circulate in economy if you fo not do this then pay wealth tax. I HOPE I HAVE MADE THIS CLEAR TO YOU. BELIEVE ME COURTS HAVE EXEMPTED AGRICULTURAL LANDS....OTHERWISE THINK WHAT WILL BE THE CONDITION OF OUR POOR FARMERS IN OUR AGRICULTURAL BASED ECONOMY. FO NOT WORRY.

JOHN

OWNER

31 Points Joined May 2014

Originally posted by : caaspirant

Start using it for agricultural purposes. Though it is not specified as exempt or non taxable but several courts in several such cases have allowed exemption from wealth tax, they have done so keeping in mind the main intent of wealth tax that wealth should not remain idle in few hands and should be used in such a way that income can circulate in economy if you fo not do this then pay wealth tax.
I HOPE I HAVE MADE THIS CLEAR TO YOU. BELIEVE ME COURTS HAVE EXEMPTED AGRICULTURAL LANDS....OTHERWISE THINK WHAT WILL BE THE CONDITION OF OUR POOR FARMERS IN OUR AGRICULTURAL BASED ECONOMY. FO NOT WORRY.

Unfortunately as the land is very close to the city centre they will not allow agricultural use. We have coconut trees on the land, but the tax dept does not allow it.

thankyou