Wealth tax came into existence on 1st April
1957. Wealth tax is derived from the property
owned by the proprietor. The proprietor needs to
pay tax every year on property owned by them.
The residential property that does not yield any
income to its owner is also subjected to wealth
tax. Wealth tax is termed as most significant
direct tax. As per the wealth tax act, wealth
tax is applicable to the following:
- An individual person
- A group of people who own a property
- A company or organization
- A Hindu undivided family (HUF)
- Person belongs to 1-by -6 categories
- A representative or heir of a dead person
- Non corporative tax payer
The chargeability of a wealth tax in India for
its residence or foreign citizens are different.
Any person who is resident of India has to pay
wealth tax under his/her name. If owner of
property is deceased, heir of the property is
bound to pay the wealth tax of the property.
If a person owns a citizenship of a foreign
country and he/she acquires a property in India
as well as in foreign country. Under those
circumstances the property owned by the owner in
India is taxable where as property located
outside India is exempted from the list. All
assets and debts outside India are out of the
scope of Wealth Tax Act.