Important Obligations

Deduct TDS @ 20% on payments made to Non-resident for purchasing immovable property.

If the seller of an immovable property (other than agricultural land) is a non- resident, then the buyer is obligated to deduct tax @ 20% where the capital gain is a long term. The applicable rate of deduction of tax will be 30% in case the capital gain is short term. [Section 195].

Buyer to deduct tax at 15% on purchase of equity shares, units of equity oriented fund, if the seller is a non-resident.

If the seller of equity shares in a company or any unit of an equity oriented fund is a non- resident and the transaction is short term, then the buyer is obligated to deduct tax @ 15% and pay the same to the Government account within 7 days [Section 111A].

Payment towards Long Term Capital Gains/ Income from investment to NRIs attracts TDS @ 10% of Long Term Capital Gains and 20% of investment income.

Anyone responsible for making any payment towards long term capital gain or towards income from investment to any Non- Resident Indian, the payer is required to deduct tax @ 10% on Long term Capital gain and deduct tax @ 20% on income arising from investment or long term capital gain from asset other than specified asset. The payer is obligated to deposit such tax deducted within 7 days [Section 115E].

Wealth Tax is applicable to every Individual, HUF and Company at the rate of 1% on the amount by which Net Wealth exceeds Rs.30 lakhs.

The assets which are included in net wealth are residential/commercial land; residential building/flat (if not let out for more than 300 days in a year); jewellery, bullion, utensils of gold/silver; cash-in-hand above Rs. 50,000/-. [Refer Section 2(ea) of the Wealth Tax Act, 1957].