Wealth TAX - STUDENTS OF CA AND CS
Tax by KK classes for CA, CMA & CSYour education in tax is best if you can give tax adviseWealthTAXCS K.K. AgrawalICAI & ICSI FacultyNever say dieCovers alltheory andpracticalproblems ofpast examsCA FinalCMA Inter / FinalCS Executive / CSProfessional
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Written in easy to understand languageSelf Help Study bookWealth TaxAct 1957CS K.K. AgrawalNever Say DieContentChapter1Chargeability2Assets3Deemed Assets4Exempted Assets5Incidence of wealth taxAssignment Practical Questions6Valuation of assetsforCA FInalCMA Inter / FinalCS Exe / ProfessionalOther CoursesPage12&34 to 67&8910 to 1314 to 20
Wealth TaxFirst Edition 2004Eleventh Edition 2014Published by Kaushal Kumar AgrawalCopyright Kaushal Kumar AgrawalWe have come to know that some unscrupulous elements are not only copying the contents as it is but alsopublishing it. This is in gross violation of Copyright Act. If anyone is found voilating the Act, appropriate legalaction shall be taken.All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, transmitted orutilized in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without theprior permission of the copyright owner. Application for such permission should be addressed to the publisher.Every effort has been made to avoid errors or omissions in this publication. In spite of this, errors may creepin. Any mistake, error or discrepancy noted may be brought to our notice which shall be taken care of in thenext edition. It is notified that neither the publisher nor the author or seller will be responsible for any damageor loss of action to any one, of any kind, in any manner, therefrom. It is suggested that to avoid any doubt thereader should therefrom all the facts, law and contents of the publication with original Government publicationor notifications.Printed in India.Price 30/-With theblessings ofLord Krishna
1Pay tax on dead assetsChargeability SECTION 3. WHO IS LIABLE FOR PAYMENT OF WEALTH TAX1. Individual. It includes trustees of a private trusts, legal heir.2. HUF3. Company.However partnership firms and association of persons are not liable to wealth tax but partners of a firm ormembers of an association of persons are liable for their share in the property of the firm or association as thecase may be.SECTION 45. WHO IS NOT LIABLE FOR PAYMENT OF WEALTH TAX1. Section 25 companies. (Non- Profit companies)2. Any co-operative society3. Any social club4. Any political party as defined u/s 13A of the Income Tax Act5. A mutual fund specified u/s 10(23D) of the Income Tax.SECTION 3. RATE OF WEALTH TAX1% of the amount by which net wealth exceeds 30 lakh.SECTION 2(q).WHEN VALUATION DATE FALLSValuation date is 31st March immediately preceding the assessment year. For the AY 2013-14, valuation date is31-3-2013.In case of confiscation of an asset, it will not be included in the net wealth of the assessee because itr ceases tobe property of the assessee.But where the asset is seized but not confiscated, then it will be include in the net wealth of the assessee becauseit belongs to the assessee. [Jayantilal amritlal (Guj.)]SECTION 2(m). COMPUTATION OF NET WEALTHSection 2(ea) Section 4 - section 5 - debts owed by him on the valuation date which have been incurred inrelation to the taxable assets.DEBT1. Debt is owed by the assessee on the valuation date; and2. Debt should have been incurred in relation to those assets which are included in the net wealth of theassessee.3. Wealth tax is not to be treated as a debt. Liability under the wealth tax is not a debt owed by the assesseeincurred in relation to the assets taxable under the wealth tax Act. It is a personal liability of the assessee.
taxbykk.comCS K.K. Agrawal22AssetsWealth TaxUnproductive Assets SECTION 2(ea)(i). BUILDING(a) Any building or land appurtenant thereto whether used for commercial or residential purpose is treated asan asset.(b) Any farm house situated within 25 km from the local limits of municipality or cantonment board is treatedas an asset. (It means farm house situated beyond 25 km from the local limits of municipality or cantonmentboard is not treated as asset)Exception: However following buildings are not treated as an asset(i) A residential house allotted by a Company (not individual or HUF) to a full time employee whose GrossAnnual Salary (GAS) is less than 10 lakh (GAS all cash salary excluding perquisites)a. X Ltd. allots a residential house to a full time employee whose GAS is less than 10,00,000.b. Mr. X allots a residential house to a full time employee whose GAS is less than 10,00,000.c. X Ltd. allots a residential house to a part time employee whose GAS is less than 10,00,000.d. X Ltd. allots a residential house to a full time employee whose GAS is 10,00,000.Ans : Not an asset; It is an asset; It is an asset; It is an asset.(ii) A residential property which is let out for a minimum period of 300 days in the PY not treated as an asset.However commercial house if let out or lying vacant treated as an asset.(iii) Where the building is used for commercial/residential purpose forming part of stock in trade is not treatedas an asset.(iv) When the building is occupied by the assessee for the purpose of any business or profession carried on byhim. (e.g. Factory, Godown or Office Building)Note: As per the Memorandum explaining the Finance Bill, 1996, the objective of including a house forcommercial purpose in the definition of asset is to cover those houses which are let out. The letting out isnot considered “as occupied for carrying on the business”. Therefore house meant for commercial purposesis an asset if it is let out or is lying vacant.(v) When the building is the property in the nature of a commercial establishment or complex. (E.g. LIC building;Videocon Tower)RABINDRANATH DHAL: In this case the High Court held that if a building owned by a person is madeavailable to the partnership firm in which such person is a partner and the partnership firm uses the buildingfor the purposes of its business or profession, then it can be said that the building is being used by the partnerfor the purposes of his business or profession and consequently such building is not an asset. Under thegeneral law partnership firm is not a legal entity and the partners collectively constitute a partnership firm.The said building shall not be included in wealth of the partner since it is not an asset.SECTION 2(ea)(ii). MOTOR CARSIt includes all motor vehicles except heavy vehicles. Heavy vehicles, Bus, trucks are not treated as motor cars,therefore they are not treated as an asset.Not treated as an asset in following casesa. Motor cars used by the assessee in the business of running them on hire; orb. Motor cars held as stock-in-trade.
taxbykk.comCS K.K. Agrawal3Wealth TaxSECTION 2(ea)(iii). JEWELLERY ETC.Jewellery, bullion, utensils, or any other article made wholly or partly of gold, silver, plantinum or any otherprecious metal or any alloy containing one or more of such precious metals.Not treated as an asset in following casesa. If the above said asset forming part of stock in trade.b. Gold Deposit Bonds issued under Gold Deposit Scheme, 1999.Note: “Jewellery” includes:(i) ornaments made of gold, silver, platinum or any other precious metal or any alloy containing one or more ofsuch precious metals, whether or not containing any precious or semi-precious stones, and whether or notworked or sewn into any wearing apparel.(ii) precious or semi-precious stones, whether or not set in any furniture, utensils, or other article or worked orsewn into any wearing apparel.SECTION 2(ea)(iv). YACHTS, BOATS AND AIRCRAFTSShip is neither a boat nor a yacht and therefore not treated in the net wealth of the assessee.Not treated as an asset in following casesa. If the above said assets forms part of stock-in-trade.b. If the above said assets are used by the assessee for commercial purpose.SECTION 2(ea)(v). URBAN LANDMeaning of urban land(A) Any area within the jurisdiction of Municipality / Cantonment board; or(B) In any area within the distance, measured aerially (shortest aerial distance)URBAN AREAPopulation (as per latest census)(i)more than 10,000 and upto 1,00,000(ii)more than 1,00,000 and upto 10,00,000(iii) exceeds 10,00,000Distance (Straight distance as crows flies)2 k.m.from the local limits of any6 k.m.municipality or cantonmentboard.8 k.m.Not treated as an asset in following casesa. Land on which construction of building is not permissible under any law.b. When the land is occupied by any building which has been constructed with the approval of appropriateauthority.c. Any unused land held by the assessee for industrial purpose for a period of 2 years from the date of itsacquisition. (It means that any unused industrial land held for more than 2 years shall be treated as anasset)d. Any land held by the assessee as stock in trade for a period of 10 years from the date of its acquisition byhim. (It means that any land held for more than 10 years as a stock in trade shall be treated as an asset)SECTION 2(ea)(vi). CASH IN HANDa. Cash in hand held by Individual or HUF in excess of 50,000.b. In case of a company, if during search and seizure any unaccounted cash is found, then the amount ofunaccounted cash not recorded in books of account as on the valuation date and which is not adjusted by theDepartment against any tax liability upto the valuation date shall be treated as an asset in the hands of theCompany.Note: However cash at bank and cheques are not treated as an asset.
taxbykk.comCS K.K. Agrawal43Wealth TaxClubbing of AssetsDeemed Assets SECTION 4(1)(a)(i). ASSET TRANSFERRED TO SPOUSEIf any asset owned by an individual is transferred directly or indirectly without adequate consideration to hisor her spouse then value of such asset shall be included in the net wealth of the transferor provided followingconditions are also satisfied. Transfer is not done in connection with an agreement to live apart. Relationship of husband and wife exist both on the date of transfer of asset and on the valuation date. Accretion of transferred asset in the hands of transferree shall not be clubbed. Asset acquired from income of the assets which is transferred shall not be clubbed.Assets have been transferred by the individual to his or her spouse, directly or indirectly, otherwise thanfor adequate consideration or in connection with an agreement to live apart, is included in net wealth of thetransferrer.SECTION 4(1)(a)(iii) ASSET TRANSFERRED FOR THE BENEFIT OF SPOUSEAssets held by person or association of persons to whom such assets have been transferred by the individual,directly or indirectly, otherwise than for adequate consideration for the immediate or deferred benefit of theindividual or his/her spouse, shall be included in the net wealth of the transferor.SECTION 4(1)(a)(v) ASSET TRANSFERRED TO SON’S WIFEAssets have been transferred to the son’s wife by the individual directly or indirectly otherwise than for adequateconsideration is included in net wealth of the trasferor.SECTION 4(1)(a)(vi) ASSET TRANSFERRED FOR THE BENEFIT OF SON’S WIFEAssets have been transferred by the individual to an association of persons, directly or indirectly otherwise thanfor adequate consideration for the immediate or deferred benefit of the son’s wife, or such individual or both isincluded in net wealth of the transferor.SECTION 4(1)(a)(ii) ASSET HELD BY A MINOR CHILDAsset held by a minor child not being a minor married daughter shall be included in the net wealth of hisparent Where the marriage of his parents subsists, in the net wealth of that parent whose net wealth (excluding theassets of the minor child so includible under this sub-section) is greater; or Where the marriage of his parents does not subsist, in the net wealth of that parent who maintains the minorchild in the previous year. Where any such assets are once included in the net wealth of either parent, any such assets shall not beincluded in the net wealth of the other parent in any succeeding year unless the Assessing Officer is satisfied,after giving that parent an opportunity of being heard, that it is necessary so to do.However in following cases assets held by minor child is not included in the hands of parents a minor child suffering from any disability of the nature specified in section 80U. assets acquired by the minor child out of his income which accrues to him as a result of (i) manual work doneby him; or (ii) activity involving application of his specialised knowledge and experience. In case of minor married daughter.
taxbykk.comCS K.K. Agrawal5Wealth TaxSECTION 4(1)(a)(b). INTEREST IN THE ASSET OF THE FIRM/AOP (NOT BEING A COOPERATIVE HOUSING SOCIETY)Interest of the partner or member in the assets of the firm or association of persons is the value of interest in theassets of the firm or association shall be included in the net wealth. The value of interest shall be determinedas per Schedule III.Where a minor is admitted to the benefits of partnership in a firm, the value of the interest of such minor in theassets of the firm determined as per Sechedule III will be included in the net wealth of the parent.SECTION 4(1A). SELF-ACQUIRED PROPERTY CONVERTED INTO JOINT FAMILYPROPERTYWhere an individual (member of a Hindu undivided family), converts his separate property into HUF propertydirectly or indirectly, to the family otherwise than for adequate consideration, then the converted property orany part thereof shall be deemed to be assets belonging to the individual and not to the family.However where the converted property has been the subject-matter of a partition amongst the members of thefamily, the converted property or any part thereof which is received by the spouse of the individual on suchpartition shall be deemed to be assets transferred indirectly by the individual to the spouse and thus includedin the net wealth of the Individual.SECTION 4(1)(a)(iv). REVOCABLE TRANSFERAny transfer which is not irrevocable is revocable transfer. Value of property shall be included in the net wealthof the transferor.SECTION 4(5). ASSET TRANSFERRED IRREVOCABLYValue of any asset transferred under an irrevocable transfer is liable to be included in computing the net wealthof the transferree. However when the property revert back to transferor then in the hands of transferor.Irrevocable transfer includes a transfer of assets which, by the terms of the instrument effecting it, is notrevocable- for a period exceeding six years [transfer for more than 6 years] or- during the lifetime of the transferee,and under which the transferor derives no direct or indirect benefit, but does not include a transfer of assets ifsuch instrument—(i) contains any provision for the retransfer, directly or indirectly, of the whole or any part of the assets orincome therefrom to the transferor, or(ii) in any way gives the transferor a right to reassume power, directly or indirectly, over the whole or any partof the assets or income therefrom.SECTION 4(5A). BOOK ENTRYWhere a gift of money from one person to another person is made by means of entries in the books of accountmaintained by one or more of the following persons: the donor an individual or a Hindu undivided family or a firm or an association of persons or body of individuals withwhom or which he has business or other relationship,then the value of such gift shall be liable to be included in computing the net wealth of the person making thegift [Donor]However the value of such gift shall not be included in the hands of donor if he proves to the satisfaction of theAssessing Officer that the money has actually been delivered to the other person at the time the entries weremade.
taxbykk.comCS K.K. Agrawal6Wealth TaxSECTION 4(6). IMPARTIBLE ESTATEThe holder of an impartible estate shall be deemed to be the individual owner of all the properties comprisedin the estate.SECTION 4(7). MEMBER OF A COOPERATIVE SOCIETYWhere the assessee is a member of aco-operative society,company orother association of persons anda building or part thereof is allotted or leased to him under a house building scheme the assessee shall be deemedto be the owner of such building or part.Then the value of such building or part, shall be included in computing the net wealth of the assessee.Any outstanding instalments payable under such scheme towards the cost of such building shall be deducted asa debt owed by him in relation to such building or part.SECTION 4(8)(a). POSSESSION OF PROPERTY IN PART PERFORMANCE OF CONTRACTA person who is allowed to take or retain possession of any building or part thereof in part performance of acontract of the nature referred to in section 53A of the Transfer of Property Act, 1882.SECTION 4(8)(b). LEASED ASSETSWho acquires any rights (excluding any rights by way of a lease from month to month or for a period notexceeding one year) in or with respect to any building or part thereof by virtue of any such transaction as isreferred to in section 269UA(f) of the Income-tax Act, 1961, [i.e lease for atleast 12 years] shall be deemed tobe the owner of that building or part thereof and the value of such building or part shall be included in computingthe net wealth of such person.RULES FOR TREATING THE ASSET AS DEEMED ASSET FOR ABOVE SAID PROVISIONS1. If the form of asset transferred is changed before the valuation date, the value of substituted asset shall beincluded in the net wealth. But if the substituted asset is the one which is not an asset, it shall not be includedin the net wealth of the transferror. [M G Kollankulum]2. Where the property transferred to the spouse was not an asset on the date of transfer but on the valuation datesuch property is an asset the value of such property shall be included in the net wealth of the transferror.3. Wealth acquired from income of the assets which is transferred shall not be clubbed.4. The value of the asset is the value as on valuation date. Where the form of asset is changed, then value ofconverted asset as on valuation date shall be taken.5. Entire clubbing is to be done when there is inadequate consideration, since there is no provision of to doclubbing only to the extent of inadequacy. [Junus Haji Ummer Sait]
taxbykk.comCS K.K. Agrawal74Wealth TaxExempted Income : Exempted AssetsExempted AssetsSection 5 SECTION 5(i). TRUST PROPERTYAny property held by the assessee under a trust or other legal obligations for any public purpose of a charitableor religious nature in India is exempt.Exemption is not available in respect of the business assets of the trust. However in following cases businessassets shall be exempt from tax.a. Where the business is incidental to the attainment of the objectives of the trust and separate books of accountsare maintained by such trust in respect of such business.b. Business carried on by an institution, fund or trust referred to in section 10(23B) or section 10(23C) of theIncome Tax Act.Section 10(23B): Trusts existing solely for the development of khadi or village industries.Section 10(23C): Universities, Educational institutions and hospitals.SECTION 5(ii). HUF PROPERTYInterest of the assessee in the coparcenary property of any HUF of which he is member is exempt.SECTION 5(iii). ONE BUILDING OF THE RULERAny one building in the occupation of the ruler is exempt provided it is decl
FREE download of our tax e books from taxbykk.com. Following Face to Face and . CMA Final Tax Management and Practice CMA Inter Direct Tax CMA Inter Indirect Tax. Written in easy to understand language Self Help Study book Wealth Tax Act 1957 CS K.K. Agrawal Content Chapter Page 1 Chargeability 1 2 Assets 2 & 3
1.2 The Scope of our Wealth Management Services 1.3 Components of Wealth Management 1.4 Process of Wealth Management 1.5 Need for Wealth Management 1.6 Expectation of Clients 1.7 Challenges to Wealth Management in India 1.8 Code of Ethics for Wealth Managers 1.9 Review Questions 1.1 Introduction to Wealth Management What is 'Wealth Management'?
the top, and, thus, lower wealth mobility. Conversely, higher wealth mobility where self-made wealth replaces inherited wealth would result in more men at the top of the wealth distribution. Judged by this proxy, and corroborated by various data sources, wealth mobility decreased in the period 1925– 1969 and increased thereafter.
In this overview, we briefly define the concepts of "wealth" and "wealth creation", explain why a focus on wealth creation is important, discuss recent efforts to promote rural wealth creation, discuss what is known from past research about rural wealth creation, and introduce a conceptual framework for rural wealth creation and the theme
the net wealth tax with the support of the theory of ability to pay tax."). For a general discussion of the use of wealth taxation to provide for equality, see Edward N. Wolff, Top Heavy: A Study of the Increasing Inequality of Wealth in America (Twentieth Century Fund Report, 1995). A wealth tax could also assist the administration of other
Stamp Duty 83 Tax Payments and Tax Return Filing 85 Monthly tax obligations, Annual tax obligations, Early tax refunds Accounting for Tax 91 Tax Audits and Tax Assessments 93 Tax Collection Using Distress Warrant 100 Tax Dispute and Resolution 102
New York State Withholding Tax Tables and Methods Effective July 1, 2021 The information presented is current as of the publication’s print date. Visit our website at www.tax.ny.gov for up-to-date information.File Size: 278KBPage Count: 22Explore further2020 tax tableswww.tax.ny.gov2021 Income Tax Withholding Tables Changes & Exampleswww.patriotsoftware.comWithholding tax forms 2020–2021 - current periodwww.tax.ny.govWithholding tax amount to deduct and withholdwww.tax.ny.govWithholding taxwww.tax.ny.govRecommended to you b
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Tax-Free Wealth, Tom Wheelwright, Robert Kiyosaki’s personal tax advisor, teaches you in plain English how to use the tax code to make you richer. With priceless insights on taxes and tax planning, you’ll learn: Why governments want you to pay less taxes, Why (seeming) complexity of the tax
