if 2 residential houses are given for an assessee say.for Rs.12,00,000 and Rs.14,00,000 and loan for the above houses say Rs.4,00,000 and Rs.8,00,000 respectively.(ignoring area occupied )How to treat it.....
taking into consideration that only one residential house(500 sq ft) is exempt for calculating net wealth of the assessee.
first of all, there is no restriction regarding area of rsidential house. one residential house is exempt for wealth tax only in case of individual irrespective of area of flat.
which of the house should be taken for exemption is at the option of assessee. loan amount of that house will not be available for deduction. so consider such pair which is most benifitial. in u r case, if u choose house worth rs 12,00,000 for exemption then
amount chargeble to wealth tax would be RS 14,00,000 ( other house ) - loan for that 800000 = Rs 6,00,000
if u exempt house worth Rs. 14,00,000 then wealth tax would be on Rs. 12,00,000 - loan for that house 400000 = Rs. 8,00,000
first option is most benifitial. so go for that
this is assuming that there r other taxable assets also. if u have only this two assets, then wealth tax liability does not rise. for any clarification, feel free to ask
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