You as an inhabitant of India and getting good salaries, there is a probability that you are liable to pay income tax. However, it is important in here to understand that income tax is not the only tax which is levied on you. There are almost 20 types of taxes which are levied on the individuals. There are the direct taxes and the indirect taxes. Also, We have very special types of taxes. It will be worth to have a comprehensive knowledge of all these taxes. There are some taxes, which are applicable in a given situation. One such tax is the Gift tax and later we discuss about wealth tax.
What is the Gift-tax?
There is no separate tax categorized as a gift tax. However, if there are chances of you receiving a gift, of money more than Rs. 50,000/- then you will be required to pay some additional income tax. If you get income with lotteries or some interest income it will also fall under the head of “Income from other sources”. Hence, you will be levied the gift tax on it.
Are there any exemptions from Gift tax?
Indeed, not all the gifts which are received by you fall into the category of Gift tax. There are the following exemptions which are not chargeable under the income tax:-
- If you have a gift received on the occasion of marriage.
- If you have received money or some property as a will or by inheritance.
- When you have received a particular gift or money from a relative. There is a set rule for the relatives. The relatives can be parents; spouse, siblings, children, spouse or children, spouse’s parents, siblings of the spouse and their spouse are also involved in this. If there are gifts received from NRI relatives of the same criteria, then they are also exempted.
What is wealth tax?
In accordance with the tax law, every individual, Hindu Undivided Family, and Company, which has a net wealth exceeding a limit of 30 lakhs, will be liable to pay the wealth tax. However, with the wealth tax, there is no surcharge of the cess levied on it. In the category of wealth tax are included the non-productive assets as well as deemed assets.
Is there any exclusion from the wealth tax?
- There is no wealth tax applicable on the Productive assets.
- Exclusion for real estate or residential property on the property which is occupied by the assessee for his professional’s needs or any commercial property or even the property which is held on a stock.
- There are also exclusions for motor cars, yachts and aircraft. The yachts and aircraft are excluded if they are used for commercial purpose. With the motor car, it is excluded if used for business.
- There is an exclusion of jewelry, whether gold, silver or precious stone jewelry included in the wealth tax.
- There is also the exclusion of urban land, if on it no construction is allowed or it is an unused industrial land or has been held as stock in trade.