Valuation for Taxation
Under the Indian Wealth Tax Act, the relevant section is Section 34AB. However, the Wealth Tax Act has been abolished, and as of my last knowledge update in September 2021, it is no longer in effect.
On the other hand, under the Income Tax Act and the Goods and Services Tax (GST) Act, valuation is carried out for various purposes. Here are some common purposes for which valuation is conducted under the Income Tax Act and GST Act, along with the relevant sections:
Income Tax Act, 1961
- Valuation of Immovable Property (Income from House Property) –
Section 23: Valuation of property for determining income from house property for taxation.
- Valuation of Capital Assets (Capital Gains) –
Section 48: Valuation of capital assets, such as land, building, and securities, for calculating capital gains tax.
- Valuation of Perquisites (Income from Salaries) –
Section 17(2): Valuation of perquisites provided by employers to employees for taxation.
- Valuation of Stock-in-Trade (Income from Business/Profession) –
Section 145A: Valuation of stock-in-trade for the purpose of determining income from business or profession.
- Valuation for Transfer Pricing –
Section 92C: Valuation of international transactions and specified domestic transactions for transfer pricing purposes.
Goods and Services Tax (GST) Act
- Valuation for GST –
Section 15: Valuation of taxable supplies under GST, including goods and services, based on the transaction value.
- Valuation of Imported Goods –
Section 14: Valuation of imported goods for the purpose of calculating the customs value, which is then used for GST assessment.
- Valuation of Related Party Transactions –
Section 25(6): Valuation of goods and services in related party transactions for determining the taxable value under GST.
Please note that tax laws and regulations are subject to change, and there may have been developments or amendments in these laws since my last update in September 2021. It is essential to refer to the latest legal provisions and consult with tax professionals or authorities for the most up-to-date information on valuation requirements under the Income Tax Act and the GST Act in India.
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