Wealth Tax Overview prepared by Taxcel PSC for wealth tax pro, its an overview of wealth tax provisions in brief.

1. Wealth Tax Overview
Taxcel Professional Services & Consultancy
Bangalore
Ph: +91- 8123570972
www.taxcelservices.com

2. Applicable Not Applicable
Individual Section 25 Company
HUF Co-operative Society
Company Firm
AOP Chargeable u/s 21AA Local Authority
RBI
Mutual Fund Reg. u/s 10
(23d)
Political Party
Social Club
Who are Chargeable
The wealth of the firm/AOP shall be taxed in the hands of partners/members

3. Chargeability of Net Wealth
• Wealth Tax is charged @ 1% on the Net Wealth in excess of Rs.30 Lakhs
• Valuation Date is the 31st March immediately preceding the assessment year

4. Scope of Net Wealth
Before determination of total net wealth one must assess themselves as a Resident or
Non-resident of India as per IT Act 1961 to determine the net wealth.
Situation Assets in India Assets Outside India
Resident – Ordinarily Taxable Taxable
Resident – Not Ordinarily Taxable Not Taxable
Non Resident Taxable Not Taxable
Resident Company Taxable Taxable
Foreign Company Taxable Not Taxable

5. Asset – Section 2 (ea)
BUILDINGS
• Building whether used for Residential, Commercial, Guest
House are chargeable to wealth tax.
• If Residential House is let out for more than 300 days not
taxable
• Commercial establishment or complexes are exempt
• House occupied for own business or profession is exempt

6. Asset – Section 2 (ea)
MOTOR CARS
• Motor Cars are taxable
• If used in Business of running on hire not taxable
• If held as stock in trade in the business not taxable

7. Asset – Section 2 (ea)
JEWELLERY
• Jewellery includes Bullion, or any other article made
with gold,silver,platinum or other precious material
• If such items held as stock in trade not taxable
• Gold Deposit Bonds issued under Gold Deposit
Scheme 1999 not taxable

8. Asset – Section 2 (ea)
YATCHS, BOATS AND AIRCRAFTS
If these are used for personal use taxable but if used for
commercial/business purpose not taxable.

9. Asset – Section 2 (ea)
URBAN LAND
• Land situated in municipal limits are taxable
• Land classified as agriculture land not
taxable
• Land on which construction not permissible
not taxable
• Unused land for industrial purpose for 2
years not taxable
• Land held as Stock in Trade upto 10 years
not taxable

10. Asset – Section 2 (ea)
CASH
• For Individual/HUF amount in excess of Rs.
50,000
• For Others amount not recorded in the books

11. Determination of Net Wealth
Particulars Amount
Aggregate Value of Assets specified in Sec 2(ea) xxx
Add: Deemed wealth in the assessee’s hands xxx
Less: Aggregate Value of debts against above assets (xxx)
Less: Assets Exempt (xxx)
NET WEALTH XXX

12. EXEMPTIONS
• Property held under trust for any public charitable or religious nature in India
• Any interest in the HUF property as a Coparcener
• Certain exemptions for Ex- Rules (See Section 5(iii)&(iv)
• NRI’s returning to India – Assets brought by him to India or asset acquired out of
money brought to India, if such acquisition is made prior to one year of return
or any time thereafter, for 7 successive AY’s.
• Individual/HUF – One House or Plot not exceeding 500 sq.m

13. THANK YOU
Taxcel PSC
Bangalore
www.taxcelservices.com