Assets in India that attract wealth tax liability for NRIs
Wealth tax by NRIs is payable on some of the selected assets that they are in possession of in India including immovable property such as commercial, residential, farm house situated at a proximity of 25km from any municipality or guest house. Other taxable assets for NRIs in India that are also taxed for residents include personal cars,yachts, boats, aircrafts; bullion, jewellery items, utensils, furniture either in silver, gold or any other precious metal or stone; cash in hand in excess of Rs. 50,000 and urban land. gifted or transferred by the NRI
Non-taxable assets or assets exempted from wealth tax payment
Some of the assets held by an NRI in India not attracting wealth tax liability include one residential property or part of the property; plot of land with an area less than 500 square meter and any other property that has been let out for over 300 days in a particular financial year.
Assets such as fixed deposits, loans, securities, shares, stock-in-trade etc. also do not attract wealth tax liability. Additionally, assets held by the NRI in overseas market are exempt from wealth tax.
NRIs who after residing ordinarily in a foreign nation return to India on a permanent basis are provided with wealth tax exemption in case of following assets, including cash or assets brought into the country and balance amount in NRE a/c in India among others. Such exemption is granted for seven consecutive assessment years following the date at which such person of Indian origin or citizen of India returned.
Rates at which wealth tax is levied on NRIs
NRIs are charged wealth tax at a rate similar to residents which is 1% on the combined asset value in excess of Rs. 30 lac. This means that NRIs like resident citizens are provided with a basic exemption limit of Rs. 30 lakhs on net wealth.