Wealth Tax in India
Wealth Tax is Applicable To:
- Hindu Undivided Families (HUFs)
Assets that are charged under Wealth Tax in India
- House Property (Guest House, residential house or commercial)
- Urban Land
- Boats, Aircrafts and Yachts
- Motor Car
- Cash in Hand (subject to certain limits) only for HUFs and Individuals
- Jewellery, Gold Utensils, Silver, Bullions etc
- All assets that are transferred by individuals to their minor children and to spouse for considerations that are inadequate also fall under the purview of wealth tax.
- Property that has been established in nature of commercial complex
- If any of the above mentioned assets are held as Stock-in-Trade will not fall under the purview of wealth tax.
- Gold deposit bonds.
- Any house that has been on rent for more than 300 days in a year
- Any house that has been held for the purpose of business or profession.
- Residence that is allotted to an employee by company, or an Officer or a Whole Time Director (subject of conditions).
- Assets that belong to Indian repatriates
- Productive Assets like investment in UTI, debentures, mutual funds, shares etc are exempt from wealth tax.
- Property that is held by Trust.
- Any Social Club
- A mutual fund specified under section 10(23D)
- Any one house or a plot of land or a part of any house that does not extend 500sq.mts for HUF and individual assessee.
- Any interest that belongs to the assessee in the coparcenary property of HUF but he/she should be the member of the same.
- Any residential property of a former ruler.
Challan ITNS 282 is to be used in order to pay your Wealth Tax before you go forth for filling wealth tax returns. Non-payment or late payment of wealth tax attracts heavy penalty.
Penalty for Late Payment of Wealth Tax
Non-Payment of Wealth Tax
Wealth Tax in India - Changes Suggested in Direct Tax Code
- The threshold limit for wealth tax may witness a rise from Rs 30 Lac to Rs 50 Crores.
- Fixed deposits, shares, mutual funds, corporate bonds, debentures etc may fall under the purview of wealth tax. These assets may get to be valued at market price or at their actual cost, whichever is lower.
- The wealth tax rate may witness a change from 1 percent to 0.25 percent.
Similarly, wealth tax, which is a less renowned sibling of Income Tax, is also a form of tax for which we need to follow the same diligence and cautiousness. It is important to note that wealth tax is levied over and above Income Tax. We should not remain ignorant when it comes to paying wealth tax on assets possessed by us and should not only pay the wealth tax on time but should also file wealth tax returns on time.