If you thought wealth tax is only for the wealthy, think again. You have to pay a wealth tax, if the market value of certain assets exceeds Rs 30 lakhs, i.e, 1 percent of the combined value of the assets, notes a report published in ET Wealth today.
Simply put, under certain conditions, it is unproductive assets like real estate, gold, silver, even cash in locker for which you could be liable to pay wealth tax. The good part is that you don’t have to pay wealth tax on productive assets like investments in mutual funds, ETFs, fixed deposits, funds in savings accounts and the like.
And, though not many pay this tax, it should be taken seriously. Reason being, invading this tax can result in a penalty being slapped on you by the Income Tax department, which could go up to as much as 500 percent of the evaded tax. Or, may be you could even land up in jail for a few years, if the tax due was Rs 1 lakh.
Not sure if you need to pay wealth tax or not? The report provides a chart for you to figure out the answer. Read the full ET Wealth report here.