Whether it is asset?

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

30 March 2012 Our company has given 8 cars to 8 sales executives.

Do we need to pay wealth tax on these cars? Can we say these cars have been using for commercial purpose?

Thanks in advance.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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30 March 2012 Cars used for commercial purpose is relevant for persons who run taxi services etc. That is the maening of commercial use.

These cars do not satisfy this criteria and are covered under Wealth Tax

CA Dileep Surya Kumar

CA Dileep Surya Kumar (Expert)
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30 March 2012 Yes you need to pay wealth tax on cars. Only motor cars used for running them on hire and stock in trade only be excluded from the definition of assets u/s 2(ea)

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Querist : Anonymous

Querist : Anonymous (Querist)

30 March 2012 Thanks for your reply...
What value do we need to consider to pay wealth Tax?

As per wealth tax, WDV value should be considered, but WDV as per companies act or as per income tax? Bcoz it says value of assets disclosed in balance sheet.

CA Dileep Surya Kumar

CA Dileep Surya Kumar (Expert)
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31 March 2012 Depreciation means here depreciation as per Income tax, because it it says admissible depreciation.

Assets disclosed in the balance sheet need to be adjusted by depreciation.