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Taxability under income tax

NANCY (Miss) (24 Points)

03 January 2025

Is campervan taxable under income tax as capital asset on sale as it is personal but movable asset ?

And please explain it's other tax liabilities in context of GST and income tax ?

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Rama chary Rachakonda (Master in Accounts & Lawyer email ID:ramachary64@gmail.com voice no:9989324294) (5818 Points)
Replied 03 January 2025

Income Tax Implications 1. *Capital Asset*: A campervan can be considered a capital asset, as it's a movable asset.

2. *Personal Use*: Since it's used for personal purposes, any gains from its sale would be subject to capital gains tax.

3. *Capital Gains Tax*: If the campervan is sold, the seller would need to pay capital gains tax on the profit made. The tax rate would depend on the holding period and the seller's income tax slab.

GST Implications 1. *GST Applicability*: The sale of a campervan would attract GST, as it's a movable asset.

2. *GST Rate*: The GST rate on campervans is 28% (effective rate: 24.5% for vehicles with a length of up to 7 meters and 18.1% for vehicles with a length exceeding 7 meters).

3. *Input Tax Credit (ITC)*: If the campervan is purchased for business purposes, the buyer can claim ITC on the GST paid.

Other Tax Liabilities 1. *Road Tax*: Campervans are subject to road tax, which varies by state.

2. *Registration Fees*: The buyer would need to pay registration fees for the campervan.

3. *Insurance*: The owner would need to pay insurance premiums for the campervan.

Tax Compliance 1. *Maintain Records*: Keep records of the campervan's purchase, sale, and maintenance for tax purposes.

2. *File Tax Returns*: File income tax returns and GST returns (if applicable) to report the sale and purchase of the campervan. Please consult a tax professional to ensure compliance with all tax laws and regulations.

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