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Black money: Government gives one last chance to hoarders, asks them to come clean by March 2017

Not declaring the black money under the scheme now but showing it as income in the tax return form would lead to a total levy of 77.25 per cent in taxes and penalty, the government warned.  


Black money: Government gives one last chance to hoarders, asks them to come clean by March 2017

New Delhi: The government on Friday gave one last chance to black money hoarders and asked them to come clean by March 2017 by paying 50 percent tax on bank deposits of junk currencies made post demonetisation.

The government however offered tax dodgers confidentially and immunity from prosecution under the new tax evasion amnesty scheme PMGKY which kicks-in from Saturday.

Declarations under new black money disclosure scheme will be kept confidential and information won't be used for prosecution, Revenue Secretary Hasmukh Adhia said.

Not declaring the black money under the scheme now but showing it as income in the tax return form would lead to a total levy of 77.25 per cent in taxes and penalty, he informed.

He further said that a new email ID has also been created for people to give information on black money to tax authorities.

PARTICULARS

EXISTING PROVISIONS

PROPOSED PROVISIONS

 

 

 

General provision for penalty

PENALTY (Section 270A)

Under-reporting - @50% of tax

Misreporting - @200% of tax

(Under-reporting/ Misreporting income is normally difference between returned income and assessed income)

No changes proposed

Provisions for taxation & penalty of unexplained credit, investment, cash and other assets

TAX  (Section 115BBE)

Flat rate of tax @30% + surcharge + cess

(No expense, deductions, set-off is allowed)

 

TAX  (Section 115BBE)

Flat rate of tax @60% + surcharge @25% of tax (i.e. 15% of such income). So total incidence of tax is 75% approx.

 (No expense, deductions, set-off is allowed)

PENALTY (Section 271AAC)

If Assessing Officer determines income referred to in section 115BBE, penalty @10% of tax payable in addition to tax (including surcharge) of 75%.

Penalty for search  seizure cases

Penalty (271AAB)

(i) 10% of income, if admitted, returned and taxes are paid

(ii) 20% of income, if not admitted but returned and taxes are paid

(iii) 60% of income in any other case

Penalty (271AAB)

(i) 30% of income, if admitted, returned and taxes are paid

(ii) 60% of income in any other case

Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana, 2016’ (PMGKY)

New Taxation and Investment Regime

Undisclosed income in the form of cash & bank deposit can be declared:

(A) Tax, Surcharge, Penalty payable

       Tax                   @30% of income declared

       Surcharge          @33% of tax

       Penalty              @10% of income declared

       Total                  @50% of income (approx.)

(B)  Deposit

     25% of declared income to be deposited in interest    

     free Deposit Scheme for four years. 

 

From Zee News

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