I will return to India for permanent settlement in June 2007.Am I exempted from wealth tax for the next seven years?Please explain the existing wealth tax rule for bank deposits. purackal@hotmail.com
Section 5 of the Wealth Tax Act is regarding the exemption granted to certain types of case. Sub-section (v) of section 5 deals with the cases of Non resident or Person of Indian Origin returning India with the intention to settle permanently in India. The provision is clear and given as under
- “in the case of an assessee, being a person of Indian origin or a citizen of India (hereafter in this clause referred to as such person)] who was ordinarily residing in a foreign country and who, on leaving such country, has returned to India with the intention of permanently residing therein, moneys and the value of assets brought by him into India and the value of the assets acquired by him out of such moneys within one year immediately preceding the date of his return and at any time there after:
- Provided that this exemption shall apply only for a period of seven successive assessment years commencing with the assessment year next following the date on which such person returned to India.
Explanation 1.A person shall be deemed to be of Indian origin if he, or either of his parents or any of his grand-parents, was born in undivided India.
Explanation 2.For the removal of doubts, it is hereby declared that moneys standing to the credit of such person in a Non-resident (External) Account in any bank in India in accordance with the Foreign Exchange Regulation Act, 1973 (46 of 1973), and any rules made thereunder, on the date of his return to India, shall be deemed to be moneys brought by him into India on that date;”
Thus , your bank balance , assets brought from abroad and assets created out of money brought shall be exempt from wealth tax for next seven assessment years next following the day of arrival .
Thus , your bank balance , assets brought from abroad and assets created out of money brought shall be exempt from wealth tax for next seven assessment years next following the day of arrival .
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