Skip to main content

What is Wealth Tax?

Download Tax Saving Mutual Fund Application Forms

Invest In Tax Saving Mutual Funds Online

Buy Gold Mutual Funds

Leave a missed Call on

94 8300 8300

 

 

Wealth Tax is a kind of annual tax which is charged every year on the net wealth of the individual, Hindu Undivided Family (HUF) and company on the corresponding valuation date. NRIs are also held liable to pay wealth tax on the amount of their wealth in India.

 

Wealth Tax Exemption Limit

Wealth Tax has its own exemption limit. In the case of wealth tax, there is a basic exemption of 15 Lakhs. Wealth Tax is chargeable at the rate of 1% on the net worth of the individual which exceeds 15 Lakhs. Direct Tax Code in India has proposed to increase the exemption limit of wealth tax in India from existing 15 Lakhs to 1 Crore due to increasing living standards and property and gold prices

 

Assets Coming under purview of Wealth Tax are

  • Residential House or a Guest House
  • Motor Car
  • Commercial Building
  • Any farm house which is situated within 25 Kilometres from the local limits of any municipality
  • Jewellery, Bullions
  • Yachts, boat and aircrafts
  • Any cash which is exceeding Rs 50,000

 

The following assets shall not be included in the individual’s net worth while wealth tax calculation. They are as follows

  • Property held under a Trust may be a Improvement Trust
  • Residential building of a former ruler
  • Jewellery in possession of a former ruler
  • Residential or commercial property which forms part of stock-in-trade
  • Financial assets like stocks, debentures, bonds, fixed deposits

 

Deemed Assets

While calculating wealth tax, there are certain assets which don’t belong to an assesse are also deemed to be included while calculating net worth of an individual for the purpose of wealth tax. Some of them are

  • Assets transferred to spouse without adequate consideration
  • Assets held by a minor child. He may be physically or mentally retarded
  • Assets transferred without adequate consideration to son’s wife
  • Assets transferred otherwise than under an irrevocable transfer
  • Money being gifted by mere book enteries without any such payment actually made

 

Valuation Date

Wealth Tax is levied on the net wealth of an individual valued on a certain day that is called the valuation date. The valuation date is always taken as the last day of the previous year relevant to the assessment year. Hence, valuation date is March 31, immediately preceding the assessment year

Question: Does mutual fund investments or investment in equity comes under the scanner of wealth tax

Answer: Any investment held under mutual fund schemes upto any amount doesn’t come under the purview of wealth tax and hence exempted from wealth tax. Though short term capital gains tax would be charged on any investment made in mutual funds for a period of less than one year.

Illustration

 

Residential House outside India

25 Lakhs

Jewellery in India

25 Lakhs

Loans taken for residential purposes outside India

5 Lakhs

Loans taken for acquiring Jewellery

5 Lakhs

Calculation of Taxable Wealth (Net Worth)

 

Jewellery In India

25 Lakhs

Less Debt owned for jewellery

5 Lakhs

Net value of jewellery

20 Lakhs

 

Property outside India

25 Lakhs

Less Debt owned

5 Lakhs

Net value of Property

20 Lakhs

 

Total net worth for calculating Wealth Tax comes at 40 Lakhs. Wealth Tax @ 1% above 15 Lakhs equals to Rs 25000

 

 

 

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

 

 

Leave a missed Call on 94 8300 8300

 

Leave your comment with mail ID and we will answer them

OR

You can write back to us at

PrajnaCapital [at] Gmail [dot] Com

 

---------------------------------------------

Invest Mutual Funds Online

Invest Any Mutual Fund Online

 

Download Mutual Fund Application Forms from all AMCs

Download Mutual Any Fund Application Forms

---------------------------------------------

 

Best Performing Mutual Funds

    1. Largecap Funds             Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Franklin India Bluechip
      4. ICICI Prudential Top 100 Fund

B. Large and Midcap Funds         Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
      4. Birla Sun Life Front Line Equity Fund
      5. Franklin India Prima

C. Mid and SmallCap Funds          Invest Online

      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
      5. Birla Sun Life Dividend Yield Plus
      6. SBI Emerging Businesses Fund
      7. HDFC Mid-Cap Opportunities Fund
      8. ICICI Prudential Discovery Fund

D. Small and MicroCap Funds   Invest Online

      1. DSP BlackRock MicroCap Fund

2.       Franklin India Smaller Companies

E. Sector Funds          Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
      3. ICICI Prudential Banking and Financial Services Fund

F. Tax Saver Mutual Funds      Invest Online

1. ICICI Prudential Tax Plan

2. HDFC Taxsaver

      1. DSP BlackRock Tax Saver Fund
      2. Reliance Tax Saver (ELSS) Fund

G. Gold Mutual Funds        Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund
      4. Birla Sun Life Gold

H. International funds         Invest Online

1. Birla Sun Life International Equity Plan A

2. DSP BlackRock US Flexible Equity

3. FT India Feeder Franklin US Opportunities

4. ICICI Prudential US Bluechip Equity

5. Motilal Oswal MOSt Shares NASDAQ-100 ETF

Popular posts from this blog

Post Office Deposits Interest Rates

Best SIP Funds to Invest Online   SIPs are Best Investments when Stock Market is high volatile. Invest in Best Mutual Fund SIPs and get good returns over a period of time. Know Top SIP Funds to Invest Save Tax Get Rich For further information on Top SIP Mutual Funds contact  Save Tax Get Rich on 94 8300 8300 OR You can write to us at Invest [at] SaveTaxGetRich [dot] Com

Tax Slabs 2012

Slab 1 Upto Rs 1.6 Lacs Tax Rate NIL for Men; Upto Rs 1.9 Lacs Tax Rate NIL for Women; Upto Rs 2.4 Lacs Tax Rate NIL for Senior Citizen; Slab 2 Rs 1.6 Lacs to Rs 5 Lacs Tax Rate 10% Slab 3 Rs 5 Lacs to Rs 8 Lacs Tax Rate 20% Slab 4 Rs 8 Lacs onwards Tax Rate 30%   --------------------------------------------- Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.   Invest Tax Saving Mutual Funds Online Tax Saving Mutual Funds Online These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)   Download Tax Saving Mutual Fund Application Forms from all AMCs Download Tax Saving Mutual Fund Applications   These Application Forms can be used for buying regular mutual funds also   Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds ) HDFC TaxSaver ICICI Prudential Tax Plan DSP BlackRock Tax Saver Fund Birla Sun Life Tax Relief '96 R

How Tax Deducted at Source (TDS) works?

    THE tax season is here. And if you are an employee you can't blame your employer for deducting large chunks of money from your salary towards tax deducted at source ( TDS ), which he is legally obliged to do. Your bank will also deduct some percentage from your FD interest of Rs 10,000 or more towards TDS! So what is this TDS all about? How is it computed? Are there any changes this year? Read on... What is TDS? TDS reduces your taxable income and could even provide tax relief! The TDS collections account for 40 percent of the total taxes collected in the country. As the name suggests TDS is the amount of tax that is deducted at source in certain types of income . The TDS thus collected is deposited in the Government treasury within a specified time. How is it computed? Some of the types of income where TDS is applicable include salary, interest, rental fee, interest on securities, insurance commission, dividends from shares and UTI/Mutual Funds, commission and brokerage

Modern day balanced mutual fund approach

Buy Gold Mutual Funds Invest Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Call 0 94 8300 8300 (India)   In reality, most balanced funds have a strong tilt towards equity instead of a mix of equity and debt THERE are various types of mutual funds available to investors with specific features. Often investors have a particular idea about a specific type of funds in terms of their features and risks, but that is not what is actually available. Therefore, it is necessary for an investor to understand the actual position before picking up a fund. This requires some work on the part of the investor. One example can be the situation with balanced funds. Name is not representative: One of the first things that an investor has to understand is that the name of the fund is often not representative of its investment pattern. The name often represents only the aim of the fund, and not what it actually is.

Investment Strategy for Low Risk Investors

    Invest in Best Debt Funds Online   These financial strategies can help optimise the returns from safe investments   There are many reasons why investors prefer to be safe than sorry. Some of them can't stom ach the volatility that comes with stock investments. Others may have had a bad experience, which is why they want to stay away . The risk profile of an individual is determined by a combination of factors (see chart). Based on the factors that determine risk appetite, we have developed a risk tolerance test (see below). If your score puts you in the low-risk segment, here are some tips for you to optimise your returns. GO FOR TAX EFFICIENT INVESTMENTS Bank deposits are all-time favourites of those seeking low-risk instruments.They are easy to understand, widely available and anyone with a bank account can open one. Thanks to Netbanking, they also do not require paperwork. But bank deposits are tax inefficient because the interest earned is added to your income and taxed
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now