1. CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
WEALTH TAX
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
Lakshminarayanan Alaguraja
Advocate
Altacit Global
EMAIL
info@altacit.com
WEBSITE
www.altacit.com

2. INTRODUCTION
CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
• Wealth Tax is a tax on the value of wealth
owned by a person, levied under the
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Wealth Tax Act,1957.
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
• It is one of the direct taxes.
COIMBATORE
BB1, Park Avenue,
• It is annual tax. It is charged for every
assessment year commencing from 1st
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
April, 1957.
• The tax is levied @ 1 per cent on the
amount of wealth as on 31st March of
EMAIL
info@altacit.com
every year, where such amount exceeds
WEBSITE Rs.30,00,000.
www.altacit.com

3. LEGAL FRAMEWORK
CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
• Wealth tax is charged under the
Tel: +91 - 44 - 2498 4821
BANGALORE
provisions of WEALTH TAX ACT,1957
read with WEALTH TAX RULES, 1957
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
EMAIL
info@altacit.com
WEBSITE
www.altacit.com

4. WEALTH TAX ACT, 1957
CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
Mylapore,
• THIS Act came in to force with effect
from 1st April, 1957.
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
• This Act extends to the whole of
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
India.
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
• This Act is divided into 8 chapters
Tel: +91 - 422 – 6552921
and contains 119 (in numbers)
sections and 3 Schedules.
• This Act has detailed provisions
EMAIL regarding levy and collection of
info@altacit.com
WEBSITE
wealth tax.
www.altacit.com

5. CHARGING OF WEALTH TAX
CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road, Section 3 of wealth Tax Act, 1957 provides that
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
every:
BANGALORE •Individual,
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road, •HUF or
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
•Company,
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
who is an assessee shall be charged wealth tax
Coimbatore - 641018.
Tel: +91 - 422 – 6552921 @1% on the amount by which his net wealth,
determined on the basis of nationality and
residential status, on the relevant valuation date,
exceeds Rs. 30,00,000.
EMAIL
info@altacit.com
WEBSITE
www.altacit.com

6. WHO ARE NOT SUBJECT TO
WEALTH TAX?
CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
Mylapore,
Section 45 of Wealth Tax Act provides that no
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821 wealth tax shall be levied in respect of the net
BANGALORE
Suite 920, Level 9,
wealth of the following persons:
– Section 25 company
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
COIMBATORE
– Any co-operative society
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
– Any social club
Tel: +91 - 422 – 6552921
– Any political party
– A mutual fund specified u/s10 (23D) of the
Income tax Act.
EMAIL
info@altacit.com
WEBSITE
www.altacit.com

7. ASSET [sec. 2(ea)]
CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
• The term Assets has been defined
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
under section 2(ea) of wealth Tax
BANGALORE
Suite 920, Level 9,
Act, 1957.
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
• This definition covers only 6 types of
COIMBATORE
BB1, Park Avenue,
assets, basically these are
unproductive in nature.
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
• It is to be noted that for the purpose
of charging wealth tax “ there must
be an asset with in the meaning of
EMAIL
info@altacit.com sec.[2(ea)]
WEBSITE
www.altacit.com

8. ASSETS
CHENNAI
1. House
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
Mylapore,
2. Motor Car
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
3. Jewellery, Bullion, etc.,
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
4. Yachts, boats and aircrafts,
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 – 6552921 5. Urban Land,
6. Cash in Hand,
EMAIL
info@altacit.com
WEBSITE
www.altacit.com

9. DEEMED ASSETS
CHENNAI
3rd Floor, ‘Creative Enclave’,
• Asset transferred to spouse, Section 4(1)(a)(i).
148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
• Asset held by minor child, Section 4(1)(a)(ii).
Tel: +91 - 44 - 2498 4821
BANGALORE
• Asset transferred to a person or AOP, Section 4(1)
Suite 920, Level 9,
Raheja Towers, (a)(iii).
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
• Asset transferred under revocable trust, Section
COIMBATORE 4(1)(a)(iv)
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018. • Asset transferred by an individual to sons wife or
sons minor child including step child, Section 4(1)
Tel: +91 - 422 – 6552921
(a)(v)
• Asset transferred by an individual for the benefit
of sons wife, Section 4(1)(a)(vi)
EMAIL • Interest in the asset of the firm, Section 4(1)(b).
info@altacit.com
WEBSITE
www.altacit.com

10. Cont…
CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
• Converted property, Section 4(ia).
Mylapore,
• Transfer by means of entries in the
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
book, section 4(5a)
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
COIMBATORE
• Impartible assets section 4(6)
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
• House from a co-operative housing
society section 4(7)
EMAIL
info@altacit.com
WEBSITE
www.altacit.com

11. ASSETS EXEMPT FROM WEALTH
TAX
CHENNAI
3rd Floor, ‘Creative Enclave’, • Property held under a trust
148-150, Luz Church Road,
Mylapore, • The interest of an assessee in the coparcenaries
property of an HUF
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
• Any one building in the occupation of a former
Raheja Towers,
26-27, M G Road, ruler of a princely state which has been declared
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400 by the central government as his official
COIMBATORE residence immediately after the
BB1, Park Avenue,
# 48, Race Course Road, commencement of the constitution act 1971.
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
• Jeweler in possession of a ruler which has been
recognized before the commencement of the
wealth tax act.
• One house or part of the house belonging to an
individual or an HUF or a plot of land comprising
EMAIL an area of 500 sqmts or less.
info@altacit.com
WEBSITE
www.altacit.com

12. DEBT
CHENNAI
3rd Floor, ‘Creative Enclave’,
• Debts owed are interpretable to mean
the liability to pay a certain amount of
148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
money either in present or in future.
Tel: +91 - 44 - 2498 4821
BANGALORE
• It is an obligation to pay a liquidated or
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
certain sum of money.
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road, • It is not the point of time of payment
that determines whether the claim or
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
demand is a debt.
• There must be an actual debt owing on
the valuation date.
EMAIL
info@altacit.com
WEBSITE
www.altacit.com

13. NET WEALTH
CHENNAI
According to sec 2(m), net wealth
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821 means the amount by which the
aggregate value of all assets wherever
BANGALORE
Suite 920, Level 9,
Raheja Towers,
located belonging to the assesse on
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
the valuation date, is in excess of the
aggregate value of all the debts owed
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
by the assessee on the valuation date.
EMAIL
info@altacit.com
WEBSITE
www.altacit.com

14. VALUATION DATE
CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road, • A very important date in the wealth tax.
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821 • All the assets held by the assessee on that day
BANGALORE
Suite 920, Level 9, are counted for the purpose of wealth tax.
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001. • 31 March preceding the relevant assessment
Tel: +91 - 80 - 6546 2400
COIMBATORE
year is the valuation date.
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
EMAIL
info@altacit.com
WEBSITE
www.altacit.com

15. RETURN OF WEALTH
CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
• Sec 14 deals with the filing of return of
wealth.
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
• It is statutorily obligatory for every
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
person to file the return if his net wealth
COIMBATORE
BB1, Park Avenue,
exceeds maximum amount which is
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
chargeable to wealth tax.
• He can file a belated or revised return at
any time before the expiry of one year
from the end of the relevant assessment
EMAIL year or before the completion of
info@altacit.com
WEBSITE
assessment, whichever is earlier.
www.altacit.com

16. CHENNAI
3rd Floor, ‘Creative Enclave’,
148-150, Luz Church Road,
Mylapore,
Chennai - 600 004.
Tel: +91 - 44 - 2498 4821
BANGALORE
Suite 920, Level 9,
Raheja Towers,
26-27, M G Road,
Bangalore - 560 001.
Tel: +91 - 80 - 6546 2400
COIMBATORE
BB1, Park Avenue,
# 48, Race Course Road,
Coimbatore - 641018.
Tel: +91 - 422 – 6552921
EMAIL
info@altacit.com
WEBSITE
www.altacit.com