Wealth Taxation in India

The wealth taxation is India is applicable to all citizens of the country and is also called the wealth tax act, 1957. This is also considered to be direct taxes of the country. It is paid on the benefits of property ownership and the person who owns the property has to pay for the wealth tax for the time period for which he retains the ownership. It must be noted that the person has to pay for wealth tax even if it is not gaining any income.

How to pay for the wealth tax in India

The person who pays for the wealth tax is called an assessee and he may belong to the categories mentioned below:

  • A Hindu undivided family
  • Non corporate taxpayers
  • A representative of dead individual, or administrator and the executor
  • A Company
  • An agent of Non-resident
  • A body of individuals or as association of persons

It should be noted that the tax will be considers on the total income earned from the collections of Joint family in case of a Hindu Undivided Family. However, in case of non-corporate payers, they are supposed to pay the tax as per the existing tax rate as their accounts are being audited.

Wealth Tax Chargeability in India

The domicile status of a person is one of the primary factors for that person to pay for wealth tax. According to this act, the assessee’s domicile status and the status of the same needed for income tax payment should be similar. The other factor on which the wealth tax is calculated is the status of assessee. This means that it does not make any difference whether he is a non-citizen or a citizen of the country, he has to pay for wealth tax; however, if the wealth is located outside India, it will not be taxed.

Wealth Tax chargeable assets

Below mentioned are the assets on which the wealth tax has to be paid by the assessee:

  • Guesthouses, urban farmhouse, residential house and commercial property
  • Automobiles for person purposes
  • Precious items such as utensils, bullions, jewelry and furniture
  • Aircrafts, Yachts and boats which are used for non-commercial purposes
  • For the cash in hand which exceeds 50,000 for Hindu undivided families and individuals
  • Urban land which is under the authority of cantonment board or municipality and having a population over 10,000.

For filing for the wealth tax, the procedure is same as that of procedure for filing the income tax. A return of wealth form A has to be filled by the person and after reading it thoroughly; he must provide the correct information. It is highly recommended that the person must check all the documents required before filing for wealth tax form and the information is given in the Form A. You can also get the help from an attorney or a person who has complete information and knowledge about how to file for wealth tax. This will save your time and efforts.